For new real estate investors and accidental landlords, there’s more to consider than how much rent you can charge or how to find a tenant. Owning Kansas City rental property offers financial and other benefits, and you’ll have to think about a few key points as you establish and follow your real estate goals.
Investment Income and Appreciation
Kansas City real estate increases in value every year, so it’s a great way to increase your net worth. Once your rental properties are paid off, you can use the earnings to supplement income or early retirement. Owning investment properties can also help you diversify your income, especially if you lose your primary source of income. You’ll want to rent out a home that will earn you positive cash flow every month.
Rental properties are also low risk investments. If the stock market and other investments make you nervous, you’ll be happy to know that the returns on your real estate will be fairly steady. Stock values can fall or disappear but real estate is a tangible investment and it isn’t going anywhere.
Rental Properties are Diverse in the Kansas City Real Estate Market
Work with an experienced property manager to find an investment home for sale that fits your budget and investment goals. This is a great time to buy a rental property because homes prices are still low and rents are increasing.
Turning your personal property into a rental is also a great option. Rental income is taxable, but you can deduct most of the expenses related to your home. Talk to a professional accountant for what may apply to your tax situation, but you can expect to deduct any property management fees, attorney costs, insurance, depreciation, repairs, and mortgage interest.
Leverage Your Kansas City Rental Property
A large down payment isn’t required in the Kansas City market, and if you already own a home, then you may not need any cash up front. Once you start investing in real estate, you can add more assets by leveraging what you already own.
Real estate also allows you to diversify your investment portfolio. This is an important component of investing. You can even diversify within your real estate portfolio. For example, you might want to buy multi-family properties if you already own single-family homes.
Professional Kansas City Property Management
Hiring a professional Kansas City property manager will save you time and money. The experience, advice, and income provided by property managers provides peace of mind and freedom.
Property managers can also provide some help in growing your portfolio and creating some independence through the wealth generated by your rental properties. Many people who start with one investment property go on to invest in more properties and even become full-time real estate investors.
Whether you’re thinking about investing in your first rental property or you want to rent out a home you already own, please contact us at Key Partners Property Management. We can serve as your Kansas City property management resource.