One of the most profitable real estate investment strategies is the long term buy and hold method that involves purchasing a property and renting it out to tenants. Over the years, through the ongoing receipt of regular rent checks, the mortgage on your property (or properties) is essentially paid down by other people’s money.
Yet, while the process of buying and holding property is fairly straightforward, nothing is ever really as “easy” as it seems – and it does still require a fair amount of hard work and discipline in order to ensure that the process is profitable. Therefore, if you’re planning on holding Orlando property for long-term profit, there are several important steps that must be taken towards success with this real estate investing strategy.
These steps include:
- Purchasing at a discount or in a good neighborhood. When searching for a property to buy
and hold, you cannot overpay for the property. Therefore, you must ensure that you either purchase at a substantial discount, or in a good neighborhood where the property will appreciate nicely over time.
- Fix and maintain. Throughout the years, you will need to maintain the property just as you would your own home. This means ensuring that all of the systems are maintained, that the roof is in good repair, and that all of the appliances are updated regularly. This also means advertising for – and renting to – the right types of tenants who will not tear up the property, causing you to have to constantly fix it. This will help to ensure that your property is well maintained by those who live in the property as well. This is where an experienced and competent property manager can come in – and who can literally remove many of the headaches that are associated with this part of the equation for you.
- Keep rented and pay down loan. By keeping your property well maintained and your rent priced correctly, you will be able to find good tenants and keep your property rented regularly. This will, in turn, help you to keep the rent checks coming in year round. Here, too, by having a property manager that can find good, quality tenants who will keep the rent checks coming in, your property can continue to produce income the way it was intended to.
For more info, just give us a call. We’ll walk you through the process. And, because I’m also a CPA, I can provide you with additional information about the many tax benefits that are associated with owning rental real estate.