Some people are interested to invest their money in market neutral, gold, and etc. but some others are interested in starting to invest their money through rental property. It surely requires bigger capital rather than locating your money in buying some stocks but the return from this investment is terribly worth to try. No wonder it becomes one of the top investment that people are dreaming about to have. If you are lucky enough to start your own rental property, you better learn these 3 conditions that will avoid you in making the same old mistakes like the other starters did.
- Good Tenants Are Worth Their Weight in Gold
Being more selective in choosing your tenants is necessary since it will save your spending. In fact, having bad tenants will cost you lots of money in repair; it can charge you until $6000. Therefore, you need to appreciate your tenants if you think you already find the right tenant. So, how can I know if my tenant is good enough? A good renter will take immaculate care of the lawn and keep the home clean. In addition, they will also decorate your property for the holidays and think that your rental as it was theirs.
- Check Your Property Taxes
Learn about your country property taxes, if there is any difference between your primary residence tax and your rental property. Mostly, property tax caps on rental properties were a full percentage point higher than those on homesteads and your primary residence. Therefore, knowing this will avoid you from any property taxes explode that you might never know simply because you never search for any information related to property taxes. Bear in mind that every country has different regulations for their property taxes, so learn it carefully is the best advice.
- Repairs will Be Expensive and Unexpected
Always include unexpected things in your budget, or in other words, you need to provide emergency budget for your rental property. As in several months ahead, you will need to replace a furnace, air conditioner, a refrigerator, or maybe a stove and your drain system also. This doesn’t include any repair for any damage caused by your tenants. But don’t worry as your income as rental property’s owner will allow you to pay all those expenses.