How To Buy My First Rental Property

The best way to limit your risk and increase your odds of success is to make sure you are putting enough money down to be cashflow positive.

How to buy my first rental property. It takes the right mix of demand and location to maximize your return. The problem was i had based the rental price on our old mortgage bill not the new one. Since buying my first investment property i have not touched 1 of the rental income it generates. First time rental property buyers should only buy a property that cash flows. It also enables you to weather tough economic times.

Let s say you find a rental property between 50 000 and 80 000 you ll need to save between 10 000 and 16 000 cash for a 20 down payment. I saved it all combined it with my personal savings and used it to fund more property purchases. Based on my own experience with my other rental properties in the area and based on my property manager s opinion i knew this was a solid legitimate number to work with. However before you can enjoy the latter benefits you need to first know the 12 steps to buying your first rental property. Are you looking for a single or multifamily property.

Paying cash can help generate positive monthly cash flow. Fortunately we were able to readjust the rent and raise it to take the higher property taxes into account once the first year s rental lease came to an end. With rental income taxes depreciation and income tax the cash buyer could see 9 500. Before you get too far you need to make a plan for what you want to do and how you plan on doing it. If you have been interested in owning a rental but weren t sure what steps to take here are a few tips on how to buy your first property.

As i grew my portfolio i focused on buying properties in the 65k 85k per unit range. Graham is an avid real estate investor and. It s a cash heavy investment and unless you buy the property extremely discounted your monthly profit on a home isn t going to be much. I use a great property management company for all of my rental properties and i recommend all my buyers do the same. If this is your first time buying a real estate it s a good idea to start with a lower cost property.

In this video graham stephan will guide us through the initial steps of investing in your first rental property. Buying any property and calling it a rental is not a recipe for success. Take a rental property that costs 100 000 to buy. You ll be ready for your first rental property. There will be unexpected expenses so leave a margin for error.