Many people find themselves at a point where they’re maxing out their various retirement accounts and still have money they want to invest. If you work a full-time schedule, though, you may look for passive income ideas. In essence, you want something that makes you money but minimizes the amount of direct oversight on your part.
One of the more popular options in this area is owning a rental property. Hold tight for a moment if that sounds like something that means a lot of work. Keep reading and we’ll cover some of the key rental property benefits you can enjoy.
You Can Start Small
A lot of people imagine something like an apartment building when they think of rental properties. While you can start with something like that, you can also start smaller with something like a single-family home or a duplex.
It’s a smaller initial investment. You also get a chance to see what kind of personal time you can expect to invest in managing a rental property.
Once you get stable tenants into the unit, it really does become a source of predictable passive income. Granted, you need to make sure you set aside enough of that for incidental expenses and taxes. Even so, just a couple hundred bucks in extra income adds up over the course of a year or two.
If you run a couple of multi-family units, that can end up as a sizeable source of passive income for you.
You Don’t Need to Manage It
While some rental property owners feel the need to manage the property themselves, it’s not a necessity or a requirement. You can hire a property management company to handle most of the administrative work for you.
These companies will routinely take over issues like:
- Screening new tenants
- Evicting tenants
- Lease management
That more or less frees you from the majority of headaches you face when you make rental real estate investments.
Mind the Details
While real estate investments offer you a lot of leeway in how much direct attention you give them, you must still mind the details. For example, part of rental property management is property rental property insurance. If you’re not sure what you need, you check out a site like PropertyInsurance HQ for more information.
If you do manage the property yourself, make sure you get up to speed on state and federal tenant screening laws.
Owning a Rental Property and You
The idea of owning a rental property can put some people off at first blush. They picture themselves getting dragged out of bed at 3 o’clock in the morning to deal with a burst pipe or some other catastrophe.
In reality, most maintenance tasks are routine. Even better, you can offload all of that kind of admin work to a property management company. It can cut into your passive income profits a little, but it frees you from most of the headaches.
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