There are many reasons why rental properties are a popular and profitable investment vehicles in real estate. Here are the three most important:
1. Prices go up. On average, the appreciation of a home is between 3% and 5% per year. Over a long-term period, that means a lot of profit.
2. Rent goes up. Rent is usually tied to inflation, and it typically goes up between 2% and 4% per year. You could buy a rental property today and charge $1,000 for rent now, and be able to charge $1,500 in five to 10 years.
3. The rent pays down the mortgage. Every year, your mortgage goes down and that becomes equity. Therefore, you end up with a paid-off property.
Owning rental properties is a fantastic investment. You just have to choose the right properties and manage them the right way. There are numerous other benefits that we didn’t even cover today.
If you have any questions for me or want to learn more about how you can get started investing in real estate, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.