Investing in Real Estate: I'd Buy a Rental Property, But... (Part 1)
November 1, 2017 |
I often hear colleagues and friends say, "I thought about buying a rental home, BUT...."
There are many answers that I've heard, but a lot of the time it is a variation of "I don't want to fix toilets at 3:00am", "it's too risky", or "I could never come up with a large down payment."
I had some of these perceptions before I purchased my first investment property also. What got me over the hump? The idea that someday I would have a free and clear hard asset that would keep paying me month after month, year after year. I really liked
Here is a comment I hear often:
"I don't want to fix toilets at 3:00am."
The truth is that a decade into managing rental properties, we have never gotten a 3:00am phone call about a broken toilet! Moreover, we've never had that middle of the night phone call. Not to say this can't or won't happen...it most certainly
can. However, we have systems in place so that our residents are informed on what to do in a true emergency.
In 99% of true middle of the night emergencies - fire or police are the ones that should be contacted.
If the idea of personal interaction with residents bothers you or you are worried about it taking too much time - then consider taking advantage of the many local competent and professional property management companies that exist today. I would
be happy to provide some referrals. Good companies have solid systems in place for handling any tenant request - and they can often get work done cheaper and quicker than you can. Hiring a property manager can be less expensive than you think, especially
if you've bought right and can absorb their cost right out of your cash flow on the property.
Next time I'll address the next comment I hear all the time... "It's too risky."
Hint on my philosophy...there is risk in just about anything in life worth doing.