Profits with rental properties

by Jakob Jelling

So you are interesting in becoming a landlord? Investing in
rental properties can be an exciting and very profitable
business. Not only can real estate provide current income
through rental property but it also can increase your personal
wealth or networth. Make no mistake, this is not a sure thing to
easy money and investing in real estate is not for everyone.
There are risks as with any business or investment but with
careful research and the help of a real estate professional you
can find the right property in the right location for maximum
return on your investment.

Steps to purchasing your rental property

1. Meet with a mortgage broker to determine how much you can
borrow and to obtain approval for a loan.

2. Next you need to determine the type of property you are
looking for. Will it be a single family home or commerical
property with multiple units?

3. When you have a potential property identified estimate the
possible rental income you could expect from this property based
on comparable rentals in the area.

4. Determine your anticipated cash flow from the rental. You
will need to consider income from rent compared against all
expenses including the mortgage, insurance, property taxes,
maintenance, and repairs.

5. Be sure to review the potential tax consequences of your
purchase.

6. Rent the property until you determine it is in your best
interest to sell it.

Because of the potential financial and tax consequences of your
decisions, it is very important to consult with a professional
real estate agent throughout this process. You will also likely
need the assistance of an attorney and a tax advisor.

About the author:
Jakob Jelling is the founder of http://www.cashbazar.com. Visit
his website for the latest on personal finance, debt
elimination, budgeting, credit cards and real estate.