Investors get into rental real estate for various reasons but what makes it such a popular type of investment is that this is often accessible even if your budget is limited. Many cities all over the world offer attractive returns on rental investment, like Houston in the USA for example. Let’s review together four good reasons for you to get into the rental real estate business.
Reason number 1: The number 1 reason to invest in rental real restate is that it is not out of reach for many investors. This is an accessible type of investment. In fact, by taking out a mortgage and by reimbursing it monthly with the rental income, you should end up with very limited expenses. A contribution is not necessary because the lender takes into account future rental income to calculate the loan amount. Rental investment is therefore accessible to the most modest incomes, provided however that you validate your project upstream to ensure that the amount of monthly loan payments remains well below or equal to the amount of expected rents. As you know, at Anh Thomas Investment we advise our clients to invest in Houston rental real estate and the good news is that your rental income will more than cover your mortgage expenses every month.
Reason number 2: The number 2 reason is that rental real estate investment can be considered as a low-risk type of investment. Why? Simply because of the stability of the rental market. Additionally, there are many options to protect yourself against unpleasant surprises like unpaid rent or litigation costs.
Reason number 3: The number 3 reason is that rental real estate investment allows you to create additional income. Once your mortgage is repaid, rental income constitutes a significant regular income, especially when you reach retirement to maintain your standard of living. You can also use it to finance the purchase of a new rental property. There are so many options for you to consider at this stage.
Reason number 4: This is the number 4 reason in this post but maybe the most important one after all. Investing in rental real estate is a great way to expand your family’s net worth. Once the rental commitment period has passed and your mortgage has been fully reimbursed, the accommodation can serve as a primary or secondary residence for you or one of your relatives.