"I've always wanted to be a millionaire real estate investor, so I found an empty home for sale in Wilmington, DE, and bought it. Now I just need to start collecting rent checks!" Sound familiar? If you're not careful, this could be your story too--only it doesn't lead to rental income or long-term wealth.
Many potential real estate investors are drawn in by the prospect of turning a quick profit on an investment property or sitting back and collecting rent checks without considering everything involved with being a successful landlord. Before you buy that house without a plan to make it profitable, take these four expert Wilmington property management and real estate investing insights into consideration first!
It Can Be As Simple as It Seems (But It Often Isn't)
It seems like investing in Wilmington, De is a smart way to build passive income--and it is! However, buying a property isn't an automatic guarantee that rental income makes its way to your pockets without a hitch. While rental properties are a relatively low-risk way to build investment income, they require a lot of work and the right experience to generate positive returns.
Making sure you're prepared for the adventure is the best way to get started (or build a more significant portfolio). Here's how property managers recommend how to get into real estate investing.
1. Make Sure You're Ready
If you own your own home, you already know that homeownership is a lot of work and responsibility. Operating a rental property is also a lot of work! It also comes with added responsibilities to tenants that all landlords must take on.
Before buying an investment property, make sure you're ready for the time and financial commitment. While your property will generate revenue (when operated well), it takes money to get started and cover ongoing expenses.
If you plan to manage the property and tenants on your own, be prepared for the time commitment. You'll need to set aside time every week (if not daily) to respond to renters, handle maintenance issues, collect the rent, make sure your property complies with the law, and more. One way to avoid the significant time commitment (while still making money from rental properties) is to choose a property manager to handle every task for you!
2. Real Estate Investors Must Save Up
We mentioned that it takes money to purchase and run a rental property, and you'll need cash from the start. While you might be able to Google ways to invest in real estate without any money down, our Wilmington property management team urges caution about any real estate investing hacks that seem too good to be true.
In most cases, buying a quality rental home requires money for a down payment and all of the fees that go with buying a residential property through closing on it. Most investors also need cash to take care of maintenance or upgrades before a rental is ready to hit the market.
When planning for your first investment property, make sure you also plan and budget for ongoing operating expenses. Work with a management team to help you line-item potential monthly and annual costs for your property. Property managers also help owners set the ideal monthly rent amount to cover all expenses and generate cash flow.
3. Educate Yourself to Be a Real Estate Investor
One of the best ways to improve your real estate investing success is to learn everything you can about it! From real estate investing books to podcasts, webinars, and conferences, there are plenty of educational opportunities to build your knowledge about the industry.
Your property management team is also an excellent source of rental property investing wisdom. Talking to your property manager is one of the best ways to take what you learn in books and seminars and apply it to your rentals.
4. Partner With the Best Professionals
We've already mentioned the value of finding the right property manager to care for your property and residents. Partnering with other professionals in the industry and throughout Wilmington can also boost your success!
More real estate investors have a reliable accountant and lawyer to help protect their investment and income. You might also consider partnering with a local investing group or financial partners to help you fund a property.
Get Into Real Estate Investing With Wilmington Property Management
If you're looking into real estate investing to generate passive income, it's essential to get started on the right foot. Rental properties require a lot of work and preparation, but they can be an excellent way to build more wealth! Finding the best Wilmington property management company is a great way to set yourself up for success and take care of every operational detail for your property.
Rentwell provides premier property management services in the Wilmington and Tri-State area. From finding tenants, handling maintenance requests, collecting rent payments, and advising investors on how to boost returns, we can do it all! If you're wondering how to get into real estate investing, give us a call and let us help.