Top Items to Consider Before Purchasing a Rental Property

Are You Ready to Buy a Rental Property?

For many people, buying and subsequently renting out a property can be a great investment which offers financial rewards. For others, it can be a nightmare. While negative stories shouldn't turn you off, Countywide Title has a few items to consider before buying a property for the purpose of rental investment.

Can You Afford It if Everything Goes Right?

Owning a rental property is very similar to owning a home which you live in, in the respect that there are items you can budget for. Sit down and consider all of the costs associated with your own home ownership and ensure you can afford them for a second home. Often times, investors forget about yearly payments such as council and government rates, or regular maintenance and upkeep, leaving them to fall short.

Can You Afford It If Everything Goes Wrong?

Consider for a moment that your tenants become troublesome and refuse to pay, or a large part of your rental property requires extensive maintenance. Be sure that your budget and monthly income allows you to financially absorb these costs without setting your own life back. A good rule is to ensure you have at least six months of expected rental income in your savings for these very events.

Will You Benefit Financially?

Remember that along with an extra income stream often comes extra taxes and rates which will need to be paid. While it can seem like a good idea on the surface, simply getting paid to own a house, the reality can often be more complex. Speak with your tax agent or advisor and be sure that you won't be financially worse off should you decide to purchase a rental property.

Title Insurance in Plainview

Of course, it is in your best interest to insure any property which you own and rent, including its title. Speak with Countywide Title at (806) 293-8363 and ask about the benefits of obtaining a thorough title search and comprehensive policy for title insurance in Plainview. Such a product can provide financial security in the event your ownership is challenged. ;