Investing in real estate has become a popular way to earn passive income on a tangible asset. This is a rewarding path, and whether you’re a new investor or you’re hoping to increase the value of a growing portfolio, we have some strategies that can help you succeed with your property.
It’s important that you understand what passive actually means when we’re talking about how you earn income on your property. It’s passive in the sense that you’re not actively working to bring in the income you need; tenants are paying rent to live in your property. However, the act of investing cannot be passive. You must keep up with the market, you must pay attention to how your assets are performing, and, perhaps most importantly, you must partner with experts such as local property managers.
Rental Properties Provide Passive Income
There are several easy to invest in real estate. You can buy and flip homes. You can invest in Real Estate Investment Trusts (REITs). You can look for commercial investment opportunities.
For passive income, residential rentals can make a lot of sense. You have more control over your investment property, and you settle into a long-term buy and hold strategy, which really allows you to build wealth. In a market like ours, you can rent out long term residences or short-term vacation properties.
Purchasing and renting out residential properties can generate a consistent and recurring stream of passive income over time, as long as you have tenants who are willing to pay rent on time each month. You’ll also need to keep your property well-maintained and up to date.
Know Your Rental Market
Taking the time to research the rental market and select quality tenants can go a long way towards ensuring your success with this strategy.
It’s a passive investment, but you need some basic knowledge so you choose the right property. You’ll need to understand what your rental value is likely to be, how long it may take you to find a tenant, and what kind of maintenance and upkeep you’ll need to budget for once you own the property.
Get to know the competing properties, the tenant demographics, and the economic factors that impact rental housing. This will make your investment more successful and profitable.
Partner with Property Managers
If you’re looking for a passive investment, you won’t want to spend all of your own time marketing your rental property, showing the home, screening tenants, and collecting rent. This is why you partner with local property managers. We can enforce the lease, respond to maintenance, and take care of all the day-to-day logistics so you can focus on other priorities.
When you’re looking for a passive and steady rental income stream, there are several great strategies available for building wealth with real estate investments. But, you have to know where to look and how best to take advantage of them.
These are some general strategies that all investors can think about. If you’d like some advice based on your unique investment goals, we’d love to talk with you. Please contact us at Oceans Managing Group by calling (386) 255-8585, or visit www.oceanspropertymanagement.com.
