Real Estate Investing: Saving Money on Rental Properties
Watching home improvement and renovation shows might spark an interest and push you to venture into real estate investing or lead you down the path of flipping houses to become rental properties. Real estate investing is more expensive than the stock market to get started in, especially with the introduction of robo advisors. However, because you don’t want to invest all of your money into your next project, but are interested in saving money on rental properties, your risk isn’t as high. If you’re looking for ways to add a rental property to your investment portfolio, Renovo can help.
You don’t have to be a seasoned house flipper or professional in the construction industry to do a few simple upgrades. Most properties can be bought and only need a few enhancements, such as new appliances, paint, and carpeting. Hiring a professional can cut into your end profit, but depending on the repairs, and how long you intend to act as a landlord and keep the property, it may make sense to hire someone to complete the more costly and technical repairs.
Don’t Use a Real Estate Agent
It is not necessary to use a real estate agent when buying a house or listing one for rent and not using one can actually save money. To buy a rental property without a real estate agent, you can:
- Go to open houses in the areas that you are looking to buy in
- Work with mortgage lenders on your own
- Research property data on your own
- Work totally independent of agents by looking for “By Owner” sales
Buy with a Partner
Most homeowners will buy with a spouse or other family member, but because of the ongoing trend with millennials to buy property with friends, it’s becoming more common to buy with someone outside of your family. When you purchase a home with someone else, you don’t have to contribute as high of a down payment simply because you’re splitting it with someone else. You can also expand what type of rental property you want to buy, giving you more options and a potentially higher return on your investment property.
A turnkey property is one that you don’t have to put much work into before you list for renters, and therefore can have someone move in quickly. With renters moving in immediately, you’re able to save up for any renovations or repairs that you’ll want to make to the property in the future.
List the Property Online
By listing your property online, you can list in a few different places and at a few different prices, including a market-value listing, high-price listing, and a break-even listing. By having a few different listings, you can see which one gets the most attention with potential renters, who could possibly be living in your rental property, and how much they’re willing to pay.
Look Into Government Programs
Cities and states like Dallas, Texas, that are more business-friendly, offer tax incentives for real estate investors who flip houses into rental properties, because it helps accommodate the population growth.
Contact Renovo today to talk to one of our specialized loan officers about options you have to get the financing for real estate investing and saving money on rental properties.