Are you looking for ways to turn your money into more money and make a profit while you sleep at night? Do you want to continually promise yourself a sizeable profit over time? If so, then you need to learn all that you can about purchasing rental properties the right way.
Rental properties can be an incredible source of passive income if you do it correctly. Even if it’s not your expertise, you can hire someone to manage those Memphis rental properties for you.
See below for more information on how to generate passive income using the rental properties you’re planning on investing in.
1. Find a Trusted Investment Property Company
If you’re going to go into this business, you want to make sure you have experience on your side. That’s why an investment property company can be such a tremendous asset during this endeavor.
They can help you find great tenants to lease your space, thus ensuring you a great rate of return from rent for a sizeable amount of time.
Having someone that can help you manage your Memphis rental properties will help you see higher profit margins as well. They’ll lower the cost of renovations, purchase high-quality materials that meet your budget and can help you manage the property from wherever you are.
These types of services can help you every step of the way. You’ll be able to browse through their properties and see which ones you’d be interested in investing in.
In other words, the company owns the property, renovates them, and manages them. That’s why so many people enjoy working with us at Memphis Investment Properties! We have over 750 investors, have renovated more than 6,000 properties, have over 85 dedicated employees, and have been doing this for almost 20 years.
If you’re looking for a way to build passive income from rental properties, you need to start by finding an investment property firm you can trust. That’s us!
2. Know the Expenses Ahead of Time
Wouldn’t it be nice if you knew what kind of expenses a car was going to cost you before you drove it off the lot?
Fortunately, that is a possibility as a rental property owner. There are certain monthly expenses that you’ll need to plan for. Doing so can help you project your overall profits, as well as help you come out ahead when you need to make renovations and repairs. We can help you factor that in as well!
First, you’ll want to consider the monthly mortgage payment. There are mortgage calculators online that you can use to project potential mortgage amounts and rates.
You’ll also want to consider the property taxes on the rental property you invest in. Contrary to what many people believe, that responsibility doesn’t fall on the tenant.
You need to invest in proper landlord insurance, which can include liability coverage, comprehensive coverage, and many other unforeseen emergencies.
Lastly, be sure to save a portion of your profits for maintenance and potential big fixes. As all homeowners know; things break. Putting some money aside ahead of time will lessen the blow when some of the most expensive repairs are needed.
3. Find Quality Tenants
Tenants have a bigger role in your profits than most landlords realize. If you commit yourself to tenants with a history of bad behavior or poor habits, then they will eat away at the profits you make from your property.
Due to their negligence, you’ll be forced to make several repairs and renovations to the property you may have otherwise not had to make.
Be sure to do your due diligence with the tenants you consider. We at Memphis Investment Properties can help you out with this if you choose to hire our services. Be sure to look for things like:
- Whether they make enough to afford your targeted rent
- Have a positive reputation with previous landlords they’ve worked with
- Have a friendly personality and are willing to work with you
- Whether or not they abide by your rules (pet rules, smoking rules, curfew rules, etc.)
4. Prepare for a Marathon
Remember, real estate investing is a great way to create passive income, but it takes time to get to that point.
It’s a lot like writing a blog. You take time to create the perfect product, then (in time), the product will take off and give you money as you sleep. The same thing with rental properties, although they see a more immediate return.
Rental properties are a commitment, but you don’t have to go it alone. Find an investment property company that can ease the entire process for you.
5. Look at Top-Notch Inventory
One of the biggest misconceptions about rental property investing is the “fixer-upper” approach. People think that if they can turn around a property they got for cheap, they can make more money.
Leave that to the professionals. Memphis Investment Properties makes all of the renovations before we list the properties. That way, you can start finding tenants right off the bat.
You can join our buyers list to gain access to our full inventory of newly renovated and profitable rental properties to kickstart the passive income process.
Generate Passive Income from Rental Properties Starting Today
Now that you have seen an in-depth guide on rental properties and how you can turn them into a passive income machine, be sure to use this to your advantage.
Be sure to read this article highlighting the real estate investing 101 for beginners. Feel free to reach out to us anytime by phone at 901-244-5820 and we will be happy to assist you further.