About 11 million people in the United States are landlords. If you’re looking to make a rental property investment, you’re about to join an exclusive group of people who’re reaping the benefits of owning rental property.

However, if you asked them about their experience, most would say it hasn’t been an easy journey. People think, and rightly so, that rental real estate is a relatively safe and profitable investment, but there’s a lot that goes into making this happen. Your investment can yield negative returns if you aren’t diligent.

In this article, we’re sharing some of the keys to being a successful real estate investor.

Read on!

You Need Money – a Lot of It

There’s a reason the stock market is America’s investment destination of choice. Investors can buy stocks with as little as a few hundred bucks.

In real estate, that’s not the case. You need a lot of money to invest in physical rental property. For a start, put aside at least $100,000.

If your dream is to become a real estate investor but your finances aren’t looking up, you really have no choice but to raise the funds before you can get started. Fortunately, there are a couple of fundraising methods you can use.

For instance, you can get into partnerships, where you pool funds together with another like-minded investor. Getting commercial loans is also a popular way for real estate investors to raise money.

Understand the Factors That Affect the Rental Real Estate Market

There are forces that affect the performance of the rental real estate market.

What, for instance, determines the price of rental units? The sellers don’t just wake up and slap a random price on them. Or what determines how much rent a landlord can charge on a certain unit?

The economy has a big impact on this market. So do the forces of demand and supply. If there’s an oversupply of rental units, prices will go down until the demand picks up again. Location is also a major factor.

Understanding these market forces and how they work is key to making a successful investment. There are several online resources that will educate you about rental properties and the real estate market at large.

Team Up with Real Estate Professionals

Learning about the real estate market before you start investing is a good move, but that doesn’t guarantee you success. It’s vital to work with real estate professionals as well.

When you’re looking to purchase a rental property, for instance, you might want to do it on your own. You’ll soon learn that scouting the market and negotiating prices with sellers is a tough job. You’d be better off hiring a realtor to help you.

Once the property is ready, you may want to manage into on your own. A good number of landlords do this, but that doesn’t mean you should. Hiring a property manager is the right move.

Make a Successful Rental Property Investment

Investing in rental real estate is everyone’s dream. However, only a few people have done it successfully. If you heed this rental property investment advice, you too will have a good chance of becoming a successful investor.

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