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This
is an Insurance article by an independent author and jml
Insurance takes no responsibility for its accuracy or content
Risk
and Benefits of Being a Landlord
By Mika
Hamilton
“If
your thinking is sloppy, your business will be sloppy. If
you are disorganized, your business will be disorganized.
If you are greedy, your employees will be greedy, giving you
less and less of themselves and always asking for more.” -Michael
Gerber
Investing
in real estate is a great way to increase your wealth through
capital apprecation. However, if you are interested in buying
and renting residential properties there are several things
to consider. Being a landlord can be extremely stressful and
expensive if you have managed to invest in property which
has not been well maintained. In this article, we will discussion
the benefits and risks of renting out residential real estate.
One
of the biggest benefits to renting property is that it is
very lucrative. Not only are you making an income each month
you also possess a real physical asset which is quite different
then owning stock you will never be able to see or touch.
Many
people just are not comfortable owning something they can
no see. In the recent decades, many people have decided not
to invest in the stock market and place all their money into
real estate. Who could resist! With rapidly increasing prices,
high demand, and almost no risk – the benefits are obvious.
Rental
real estate gives you a monthly income. Property also increases
in value and your capital appreciates each year. Real estate
is one of the few investments that do extremely well in time
of increase inflation.
Remember,
rental real estate can also be purchased with borrowed money
and this is called leverage. For almost no money down an investor
can own and rent a large residential property like condos
or apartments. If your rental properties cost you more then
you received in income from them, the profit is tax free.
Once there is equity in your residential property, you can
apply for a home equity loan and use that money to invest
with.
There
are also several risks associated with rental properties.
First and foremost you are liability for any injuries which
take place on the property. If a visitor breaks a finger in
a door, you have to pay for it. Not only that but you are
subject to lawsuits which will be suing for not just the injury
but emotional distress. This is why it is extremely important
that all of your properties meet government building and living
standards.
There
are always unexpected expenses. Apartments flood, walls get
cracks, and foundations leak. They are all your responsibility.
On top of that you have to deal with tenants. Ninety percent
of your tenants will be great people who mind their own business
but the other 10% will make you want to rip your hair out.
Visit
the Global Investment Institute and signup for our free Online Investing For Beginners
E-Course at http://www.Global-Investment-Institute.com
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Article
Source: http://EzineArticles.com/?expert=Mika_Hamilton
The
information supplied on this page is by a third party and
jml Property Services do not take any responsibility to its
accuracy ©jmlpropertyservices 11/06
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