In Today’s, there is a lot of money to be made from purchasing Residential Real Estate. Residential real estate investing is a business activity that has waxed and waned in popularity dramatically over the last few years.
Now a day’s people are moving more due to jobs closing down from their jobs. If you are looking for a place to settle down with your family in a new area you will not have any trouble with all the homes that are being put up for sale. Purchasing real estate can be a wise decision. You can build up equity in the home to give you a more stable future. There are many ways to make money from purchasing real estate and many people are making a good living from doing it.
Some Ways for Better Strategy to Make Money or Profit in Residential Real Estate:
- Cash Flow– How much money does the residential income property bring in every month, after expenses are paid? This seems like it should be easy to calculate if you know how much the rental income is and how much the mortgage payment is. However, once you factor in everything else that goes into taking care of a rental property – things like vacancy, expenses, repairs and maintenance, advertising, bookkeeping, legal fees and the like, it begins to really add up.
- Appreciation– Having the property go up in value while you own it has historically been the most profitable part about owning real estate. However, as we’ve seen recently, real estate can also go DOWN in value, too. Leverage (your bank loan in this case) is a double-edged sword. It can increase your rate of return if you buy in an appreciating area, but it can also increase your rate of loss when your property goes down in value.
- Debt Paydown– If you have an interest-only loan, your payments will be lower, but you won’t benefit from any loan pay down. I find that if you are planning to hold the property for 5-7 years or less, it makes sense to look at an interest-only loan, since the debt pay down you’d accrue during this time is minimal, and it can help your cash flow to have an interest-only loan, as long as interest rate adjustments upward don’t increase your payments sooner than you were expecting and ruin your cash flow. If you plan to hold onto the property long-term, and/or you have a great interest rate, it makes sense to get an accruing loan that will eventually reduce the balance of your investment loan and make it go away.
- Tax Write-Offs– For the right person, tax write-offs can be a big benefit of real estate investing. But they’re not the panacea that they’re sometimes made out to be. Individuals who are hit with the AMT (Alternative Minimum Tax), who have a lot of properties but are not real estate professionals, or who are not actively involved in their real estate investments may find that they are cut off from some of the sweetest tax breaks provided by the IRS.
Here is the one person who provides the Residential Real Estate services in the real estate market that is Tim Marais. He is an investor in this field with years of experience. People earn profits out of it from resale the houses again. He provides you services of buying and selling the property.