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INVEST IN REAL ESTATE
Investing in real estate is a popular option for more and more people, particularly those in the 35-55 age group. Building your real estate portfolio to one or two properties is a way to save for your children’s education or for retirement.
Basic rental properties are pretty straightforward. You purchase the property and then rent it out to a tenant or tenants. The owner, who is not always but most likely the landlord is responsible for the mortgage, taxes and the costs of maintaining the property.
Ideally the rental charge is enough to cover the costs plus a small cushion as either a profit or to provide a small nest egg for any unexpected expenses. Either way the owner is building equity in an investment that is also increasing in value.
Of course, it’s never as easy as it seems. There are such things as bad tenants or worse you could end up with no tenants at all, leaving you with the mortgage payment. So it’s really a matter of finding the right property where the vacancy rates are low and where people want to rent.
Working with a professional real estate agent beyond the initial purchase has it’s benefits. They’ll be able to help you determine whether an investment property is going to be successful using ‘cash flow’ as an indicator. Either way, you’re still building equity in an asset that you can sell tomorrow.
COMPARING REAL ESTATE WITH OTHER TYPES OF INVESTMENTS:
Perhaps the biggest difference between a rental property and other investments is the amount time and work required to maintaining your investment. When you buy a stock, it simply sits in your brokerage account and, hopefully, increases in value. If you invest in a rental property, there are many responsibilities that come along with being a landlord. And it’s not a get rich quick proposition, it’s definitely a slow get rick scheme.
If you are unsure of whether this is the right investment for you, start small by renting a room or suite in your house. Landlords who make their rentals into desirable places to live often get better, longer-residing tenants.
A good rule to follow is ask yourself: “would I live here”? If your answer is no, it’s time to spruce the place up a bit. Your conscience will love you, knowing you are able to provide safety and security for others.
And who is to say that this won’t become a full time occupation, turning multiple property ownership into a full-time job.
Having a real estate agent as an advocate to help evaluate potential properties and determine their investment potential can be very helpful. The knowledge, contacts and experience a real estate agent has will be beneficial to you in the long run.
WE WILL REPRESENT YOU AS AN INVESTOR ANYWHERE IN ONTARIO.
While rental property is the most obvious real estate investment, it isn’t the only one, in fact there are numerous other types of real estate investment opportunities. Ready to make an investment, would like to know what real estate investments are available to you, give us a call.
More Information On Real Estate As An Investment, From Our Blog: How To Buy A University Home For Your Child | How To Sell A House With Renters | The Next Generation of Home Buyers | FAQ: Buying or Selling Rental Properties | Real Estate Glossary & Terminology
Let Karen Paul & Associates assist with your real estate investments.