a good way to go about starting house rentals?

Question

buy small ?... does it pay for its self ? get a duplex.? how would anyone that hasnt had a house rental service start .. is it very hard?

Answer 1

It is not hard at all as long as you do the proper research. Make sure that you have a good team. That should include a good accountant, lawyer, real estate agent, and management company. They can either make or cost you money. Also, a good website is www.huduser.org. I gives you the fair market rents in a given area. Use that as a guide. Also, remember this formula. Cost of home/120=monthly rent. The idea is if a home costs $100,000 you should at least charge for rent $833 a month. If you can't get that rent, then it's not a good rental investment.

Anyways, start small. You need to see if you can do this. If you start small, and you lose out, you lose small. A duplex is good as well. The way you need to look at that is you are actually buying two units. For example... If you buy a duplex for $100,000 you are basically buying two $50,000 units. Can you rent out each unit for $416 a month? Basically, another rule of thumb I like to use is that after all of your costs, you need to make per unit at least $100 a month cash money for it to be worth your time. Anyways, good luck with this and I hope this gives you some help.

Answer 2

2

Answer 3

First, clearly understand the industry you're about to jump into. Do you want to buy homes and rent them for monthly income, or do you want to work as a property manager and manage the rentals of others?

It seems like you're looking to rent your own homes for a profit. If this is the case, keep in mind that you need a plan. More importantly, you need to understand your point for renting homes in the first place. Educate yourself as much as possible by networking with real estate investors. Talk to real estate agents who are knowledgable about real estate investing (most agents are not investors).

There are real estate investing groups throughout the U.S. and Canada that hold regular meetings. You can learn a LOT from interacting with these people and asking specific questions. When you're just starting, you don't even know the questions that you don't know you need to ask! That's why talking to people who are experienced will help you.

Good luck

Answer 4

Before you start, you want to educate yourself on the laws in your area. Some things you want to know are:

What's the maximum deposit you can demand? Do you have to pay interest on it? How much notice does a month to month tenant have to give before leaving? What do they have to do to be entitled to a deposit refund? How much time do you have to refund it? What is the process for eviction? Under what circumstances can you enter a leased dwelling? What are your responsibilities for property left in an abandoned unit? What are the responsibilities of each regarding fire regulations (blocked exits, smoke alarms, flammable materials)?

No matter how the IRS views it, owning rental property is not 'passive' income. It's a job.