Rental Properties have been the old school way of getting rich. From the renowned writer like Robert Kiyosaki and the ex-President of United States, Donald Trump, have taken the route of Real estate and Rental Properties in mitcham to get rich.
It is a slow way as the returns are usually low due to which it takes years to get back the initial investment. After the initial investment is returned you can sell that property to gain from capitals gain which is due to the inflation as the prices of property rises over the years.
Advantages of rental properties:
Rental Properties are affordable for people who cannot afford to buy the home as they might not be financially stable yet or they are in their early stages of life for example they have just become 18 and looking to move out of their parents’ home and become financially independent. People who are students tends to get a property on rental properties to live and spend their early years of college and bachelorette while they work part time to cover their expenses. Some might not even be able to afford to get a property on rental properties and they have to get a shared property where more than one person shares the rental properties of the property, this might be due to the high real estate in doncaster rates due to inflation.
Real estate properties as an income:
From an investors point of view, it’s a safe and easy way to get rich as you borrow Mortgage (home loan) from the bank, put up a little down payment from your own pocket and buy a property that will be given out on real estate and the investor will enjoy a monthly fixed amount of real estate income which is an added amount to his basic income. This will give him more buying power and he will be able to set his foot to the road of financial freedom. Although it might take years to build up the portfolio of rental properties which can cover his monthly expenses as well as the property’s maintenance expenses which will truly create financial freedom and he will be able to enjoy his vacations at Bahamas. It is the safest route as the property holds it value over time and doesn’t depreciate much except due to certain reasons like the age of the building and the economic factor. The property itself is a collateral in the case of mortgage so the borrower doesn’t need to arrange for collateral for the bank to hold on to till the person fully pay the loan.
Paying the rent on time will help you maintain a good image but once you start bothering the owner, this can lead you to real consequences.