Thinking of buying a rental property? You undoubtedly know that it's a big initial investment, but one that you make with the hope that you will have a consistent tenant and a reliable source of (relatively) passive income.
However, you might also expect that there's more to it than finding a tenant and waiting for the monthly rent payments to roll in. Read on to learn some of the pros and cons of owning such a property:
While the most obvious income you will receive as a rental property owner is in rent, that's not the only source. The Simple Dollar explained that property values tend to go up over time, and that, too, can be a big avenue of income when and if you decide to sell.
If you own a property, you are heavily dependent on having a tenant to pay rent each month. Owning a rental property isn't free, so there are costs involved, and rent helps cover them. Without a tenant, that cost is entirely yours to bear.
Fortunately, you can write off at least some of the costs associated with owning a rental property on your annual taxes, according to Investopedia. While you will have to investigate your options and probably work with a tax professional to maximise your savings on this front, they can greatly reduce that aforementioned cost of ownership.
Finally, it's worth remembering that owning a rental property cannot come with a "set it and forget it" mindset. You should check in with your tenants on a regular basis to see if everything meets their needs, and always be willing to act quickly to fix any issues they may flag. Failure to do so may encourage tenants to move out, leaving you with a potentially long-term vacancy.
When you're thinking about buying a rental property and want to get the full view of your options and how they relate to your needs, you'll want the experts on your side. At Ray White Surfers Paradise, we have closed innumerable deals for buyers and sellers alike, for properties of all shapes and sizes, so we can give you an honest picture of what to expect. Get in touch with us today to learn more.