Home ownership has come to be widely associated with living the American dream, but over the decades, it has become an increasingly difficult goal to achieve. For many families, even dual full-time incomes aren’t quite enough to make their dream of home ownership a reality. Rental properties are the best option for many people, whether it’s for the short term or for a long period of time. Choosing to rent rather than buy has advantages, as does investing in property with the intention of renting it out long term. Home ownership provides a sense of security, but not everyone is in a position to purchase, and due to variations in economic status, there are times when renting a property long term can be the best decision. As a result, individuals looking to invest in property with the intention of renting it out can make a handsome profit.
Monthly Income
For those able to acquire financing or capital to invest in property, it is wise to purchase in an area where rental costs are relatively high. Areas where property is in high demand is less likely to remain vacant for a prolonged period of time and more likely to attract tenants who recognize the value of the rental property. A person willing to pay a premium to live in a specific location will probably be more likely to take care of their rental and reluctant to damage it, either through negligence or deliberate means. A Beverly Hills luxury rental or Bel Air luxury rental will bring in a large sum each month to the property owner and the tenants in such locations will probably be concerned with the appearance of their home and meticulous about its care.
Benefits for Both Parties
It isn’t just the property owner who can benefit from a rental property. Home ownership is expensive, and it can take time for an individual to save up enough money for a down payment. A great way to save cash is choosing to rent rather than own. Renters are not responsible for repairs and upkeep, which can be expensive, and do not have to pay property taxes. California property taxes are some of the highest in the nation. According to agents working with Brentwood, LA real estate and properties in West Los Angeles real estate, property taxes can be daunting and are often the deciding factor in a person’s ability to own a home in those areas. A property owner can make back what they put out plus a profit if they choose to rent a property out, and the renter can spare themselves the burden of the tax payment.
Uncertainty
Investment involves risk, and while the risk can’t be eliminated, it can be mitigated. California real estate is ensconced in what is known as the real estate bubble, a situation where prices have gone up consistently, even during economic recessions, and retain their value in a way that isn’t necessarily observed in other areas of the country. Investing in property is one of the safest investments that can be made, especially if the investor intends to utilize that property for rental income. Rent in LA county is high, and there are certain locales so exclusive that even renters need a salary in the high six figure range to consider living there. Beverly Hills post office real estate is at a premium. Buyers and renters looking at the Beverly Hills area are typically aware that the locale’s exclusivity and amenities come at a high cost.
Resale
In addition to a monthly income, property can go up in value based on a variety of different economic factors. A property owner has the option of waiting until the value of their property goes up and then sell it, ensuring that they not only see a return on their investment, but turn a profit in addition to what they have accrued over the period of time during which they rented the property out.
For Renters
Renters also have the ability to monitor the market. Renting can allow an individual to spend time in an area and get to know it without making a lifetime commitment right away and gives them an opportunity to bide their time when it comes to selecting the right moment to purchase. Rent is typically less expensive than a mortgage payment, and without the added burden of property taxes, a renter can save money each month in anticipation of a time when they are in a strong position to buy.
Whether you’re renting or buying, it is always worth consulting with a real estate agent that has the best knowledge of the local area. A qualified agent with years of experience in the real estate market can help you navigate the market. Feel free to contact us today!
