When buy a real estate to pursue as a business, your making potentially financially-freeing decision. Owning a real estate is an excellent investment. It provides for a steady flow of income, but you should know several things before you buy. First buying a piece of real estate you're entering a world of renting.
Consider the Maintenance
When you buy real estate and decided to become a landlord, the cost of maintenance and up keep should consider. If you not a handy person or you don't have the time then you will need to hire someone to do that. Hiring a property manager, which will cost you 6% of the gross income you earn from your rentals.
Learn the Law
Rental in real estate vary from state to state, therefore make sure you are aware of the laws affecting you in your state. Although there are some variances in these laws, the basics are essentially the same; your tenant has all of the same rights of ownership except for the right to sell the real estate. In addition, as long as the tenant pays rent, he or she has the right to live on the property. At the same time, they do not have the right to damage the property in any way.The law requires that you keep the real estate in a "habitable condition." Although there is a bit of gray where this is concerned, the law is understood to mean that the real estate must have working locks on its doors and windows, the heat must work, and the roof cannot leak.
Know How to Find Tenants
Before buying a real estate make sure you have a good idea about to how you will get tenant. When choosing a renter and interview them, know the question to ask because there are several discrimination laws in place that limit the types of questions you can ask a potential renter.Before you purchase that real estate, set your standards so you know what you will and will not accept from a tenant and make sure your standards are all legal. Some areas to consider include:
- The price of rent
- Whether or not you will accept pets
- The number of allowable occupants
- The amount of your security deposit
- Whether or not utilities are included in the rent
- Any minimum income requirements you expect from your tenants
- Whether or not you will accept HUD Section 9 participants
Make sure your standards are clear to all potential tenants before you even begin the interview process.By carefully considering each of these factors before you make a real estate purchase, you will be better able to determine whether or not being a landlord is the right step for you
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