Frequently Asked Questions About Investment Properties
Question: If I’m the landlord, doesn’t that mean I’d be responsible to repair broken things on the house?
Answer: Yes in many cases. Setting up the leases carefully can alleviate some of these challenges. But most investors I work with allot 10% of the rent for these expenses. FNMA defaults to 25% of the rents for expenses. If you’re collecting $2000/mo in rents, you’d have $500/mo for repairs, vacancies and all the other expenses.
Ok, so down payment is the biggest challenge most face to buying rental properties. 15% down on a $200k single family house is only $30k, much more reasonable then $75k down on a 4 plex. But aside from down payment, another challenge people face when doing this is the structure. Like I said before, rumors are that we’ll soon accept smaller down payments. But is that wise? Cash flow is one of the challenges many landlords face.
Many tax returns come to me with rental properties on them showing a net loss each year. Why is this? It’s simple...
I think it isn’t much of a secret that real estate can be a powerful tool for us financially. Most home owners can look to their home as an asset that has allowed them further luxuries. So why not own more than one?
At 40 years old I am not banking on receiving Social Security Income. Though, I have to give them credit, it’s still pumping out income for people even though 20 years ago I was being told it would be dried up by now. Anyway, I’m not personally banking on collecting it. So what will I do when I no longer can work? Let alone w...