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Property Investments

Finding the Right Manager for Your Out of State Rental Property

Investing in an out of state rental property can be a great way to diversify your portfolio and generate passive income, but since you are not there to supervise it, how do you find the right property manager?

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As an investor, you know how important it is to act on a great investment when you find one. And, sometimes, that investment may not be conveniently located. It may even be in another state where the marketing seems to be showing incredible growth.

So, does that mean you should ditch the great investment because it isn’t local? No. As an investor, you have the world at your fingertips. It is easier now than ever before to expand your investments in property rentals. All you need to do is find the right property manager to handle your out of state rental property. Here’s what you should be looking for.

Full-Service Property Management

If you are investing in out of state rental property, then you also need to invest in a property management team to care for it. It is not feasible to try to be a landlord from a distance — whether that distance is 300 miles or 3,000 miles. You need to have someone available at all times to be able to address the needs of the property, whether it is showing the property to new potential tenants, dealing with a broken air conditioner, collecting rent, etc.

A full-service property manager will be able to handle all aspects of your rental property for you – while you remain in your home state. How do you know if they are a full-service company? Well, think of all the things that come with managing a rental property — and make sure they offer it. For example:

Your property management team should also take advantage of available technology and have a portal that you can log into from wherever you are and see the status of your property and any financial transactions concerning it.

Keep in mind that if you have a specific type of investment, such as multifamily or commercial property, then you will want to make sure the property manager you choose specializes in that type of rental. After all, not all rentals are handled in the same manner.

Knowledge of Laws

Another important aspect of finding the right property manager for your out of state rental property is finding someone who has a deep understanding of local and federal housing laws. You never want to find yourself in hot water due to issues concerning discriminatory practices and such.

Even though you may not be the one doing the lawbreaking, the property management team you hire is representing you and your property — and you don’t need the risk. Not to mention that the legal battles that may ensue can be time-consuming and very costly.

Do your due diligence when hiring a property manager to make sure they have an understanding of the laws and have protections in place to ensure they are being followed at all times. Don’t be shy to ask about this. Those companies who take following the law seriously will have no problem showing you how they do so successfully.

Licenses, Certifications, Insurance, and More

Before you turn the keys to your rental property over to anyone, you want to make sure the property manager you choose has the proper credentials to be in business. These requirements will vary based on the location of your property. Be sure to check for what is needed — and then confirm the property management team has it before you commit.

Thorough and Proven Processes

You need a property management team that has proven success. You want to know that you are hiring someone who will be able to market your property and find high-quality tenants. And when something breaks, you need to feel confident that your manager has a network of repair technicians to take care of it properly. And so on.

Taking care of an out of state rental property doesn’t just involve being reactive, but proactive, too. As you head out on your quest for the right property manager, make sure that the one you choose has a thorough and proven process in place to surpass the needs of your rental property. You should be able to feel confident that it is being cared for just as you would if you were local – or even better.

Effective Communication

Communication is key for nearly everything in life – including your relationship with your property manager. Nobody wants to work with someone who is not responsive – whether the manager or the owner.

The only way to effectively manage a property involves communication. As the property owner, you need to know that when you have a question, someone is going to answer that phone call or email. The job of a property manager can be very busy and tiresome, but there should always be time set aside to communicate openly with property owners about the status of their out of state rental property or to address any concerns.

Discuss this process with your future property manager and lay out any expectations you may have.

A Healthy Reputation

A well-known property manager is going to have a lot of satisfied clients. And that means they should have information online for you to read and put together an image. And what you are looking for is a healthy reputation.

Ask about their experience, their years in business, their specialties, and so forth. Do enough research and you should easily be able to see whether or not you are dealing with a property management team that can truly meet your needs.

The Right Property Manager: Real Property Management Evolve

Sometimes you just find the right property manager and you just know that the relationship will be a success. With over 30 years of experience and thousands of satisfied customers, you know you are getting professional, thorough, and successful Phoenix property management.

Conclusion

Investing in out of state rental property should never be limited by borders. Now that you know what to look for, if you find a great opportunity in another state, rest easy knowing that you can find help through a professional property manager.

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Property Investments

Buying an Investment Property: 7 Things to Consider

Buying an investment property comes with many advantages, here are 7 things to consider to make your investment as successful as possible.

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When it comes to buying an investment property, you may not just want to jump at the first property you see. Rather, you want to have a strategy, making sure that your purchase will bring you a healthy return on your investment. After all, there is a good chance you would like to continue building up your portfolio.

Investing can be very rewarding, but it can be challenging, too. So as you make the move to buy your investment property, here are 7 things you may want to consider.

1. Are You Ready to Be an Investor?

Anyone can be an investor, but there are a couple of characteristics that you should have. For instance, a good investor can be described as someone who is financially stable. First, if you intend to get a traditional mortgage, investment properties usually require around 15% or more for a down payment. Plus there will be inspection costs, routine maintenance, repairs, and so on. Some of these things may even be urgent, such as if a tenant calls to say that the roof is leaking or the air conditioner stopped working. You will need to have the funds in your hands to address these issues.

Next, do you have time to give the proper attention to an investment property? An investment property will require your attention, unless, of course, you have decided to turn it over to a property management team.

2. The Type of Investment Property You Will Focus On

As part of your strategy as an investor, you need to decide what type of investment property you will focus on. For instance, are you interested in single-family residential properties? Or how about investing in multi-family residential properties? Or maybe commercial space is more your cup of tea.

Whatever you take a liking to and that fits your strategy and future goals, that’s what you should focus on. And once you know this, you can narrow down your search and find the best deal — that will lead to the best ROI.

3. The Property Taxes

Depending on where you are, property taxes can vary, but they are based on the value of a piece of property. You may find a great deal on the purchase of a property but the property taxes may be incredibly high. Or, maybe you find a property that is a little more expensive, but of lower value, resulting in the taxes being lower.

As an investor, it is important to keep this in mind as these taxes are something you will be responsible for every single year. And, since property taxes are based on the value of the home. So, even if you get a good deal — those taxes could be high.

4. To Invest Alone or Partner Up?

Sometimes friends or siblings like to go in together on an investment property. And sure, it seems like a great deal when you can put your money together, right? Purchase costs, maintenance and repair costs, taxes, and all can be split which means you only have to carry half the burden in the investment. However, you will also only be getting half the profits, too.

If something goes wrong legally, you will also find yourself dealing with the repercussions, whether you were the one who made the mistake or not because you are both responsible.

5. Where You Will Invest

Before you can invest, you need to consider where you want to invest. Like property taxes, there are a few things that make an area more profitable than others. Dive into the housing market, the rental market, the job market, etc. of the area you would like to invest in. A thriving, growing area is a good sign of future growth. And always keep an ear out for plans within communities that may stimulate growth, such as future entertainment complexes, new locations of major corporations moving to the area, and so on.

6. Avoid Investment Properties Requiring a Lot of Work

If you turn on the TV to a home improvement show any hour of the day, you will likely find someone who is flipping a house. They bought it for a really good price and have decided to add $15k of updates and renovations and then flip it, making tens of thousands or more in profit. The idea of this sounds amazing. The reality, not so much.

Unless you are a contractor and can do renovations at a relatively low cost, you may get yourself in over your head. If you are an investor who is looking for rental property, the last thing you are going to want to have to do is to fix up a property before you can rent it out. Instead, look for a great deal on a future rental that only requires minor repairs to get it tenant-ready.

7. Be a Landlord – Or Hire a Property Management Company?

Finally, consider whether you want to be a landlord or if you would prefer to hire a property management team. The idea of being a landlord always seems like the ideal job – you own rental property, rent it out, and sit back collecting money. Right? Wrong.

There is a lot that goes into managing rental property. And many new landlords tend to get overwhelmed and feel underprepared to handle it. For those who are new to investing and still have a regular full-time job, being a landlord can interfere.

This is why so many investors nurture their relationship with an experienced property management team, such as Real Property Management Evolve. This team of experts will go to work marketing your property, screening tenants, handling lease signings, maintenance and repair, and so much more. And you, as the investor, can continue working on that portfolio of yours – and finding the next great deal.

Congratulations on deciding to buy an investment property. As long as you consider all aspects of the process, you will likely find it to be a very rewarding step for your future.

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Property Investments

Understanding Buy and Hold Real Estate Strategy (and How It Can Benefit You)

When looking to invest in rental properties, there are many strategies to increase passive income. One of these strategies is buy and hold real estate.

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Real estate investing is definitely not a one-size-fits-all sort of deal. There are so many different strategies and avenues to explore. For some, buying and flipping houses works well. For others, taking on the role of a landlord and managing properties works best. It comes down to your preferences, your goals (long-term and short-term), and so on.

A buy and hold real estate investing strategy is one that many investors use as their go-to investment strategy. Here’s why.

 

What is Buy and Hold Real Estate?

Many real estate investors go in with the intention of buying a property and keeping it long-term. It follows that belief that real estate bought today will be worth more years down the road. In other words, the buy and hold real estate strategy gets its name because you buy it and hold onto it in hopes of earning a greater return. It typically follows the following:

  • Find the right property
  • Finance the property
  • Upgrade the property (make it desirable, show value, etc.)
  • Rent it to high-quality tenants
  • Sell when the time is right (i.e. profitable)

That’s what buy and hold real estate investment can look like in a nutshell.

Getting started in building your investment portfolio can be intimidating and tricky. But it is important to remember that the right strategy for you could differ drastically from the strategy that other investors may have found great success with. So, as we move forward to gain an understanding of buy and hold real estate strategy, just know that it is one of many strategies available — and it may or may not be the best choice for you.

 

Why Do So Many Investors Prefer the Buy and Hold Real Estate Strategy? The Benefits

The idea in real estate investing is to make money. And when it comes to a buy and hold real estate investment strategy, you get the piece of real estate and you get to generate cash flow for years to come. Over time, you can pay off the mortgage and still continue to generate income without you having to pay out much. You can focus on other investments while still earning.

Many investors love this strategy thanks to all the tax savings. For example, expenses such as property marketing and advertising costs, maintenance costs, HOA fees, mortgage interest, insurance premium costs, utility costs, and more are all tax-deductible.

When a property is purchased, it is safe to assume it will appreciate over time based on the historical data available. The general theory is that a property you purchase today will be valued at a much higher rate down the road. This appreciation could benefit you if you go to sell the property.

Keep in mind that all of these benefits are only valuable if you do your due diligence when purchasing real estate in the first place.

 

An Investment Strategy’s Shortcomings

There are a lot of great reasons why investors choose buy and hold real estate investment strategy as their go-to, but everything can’t be all good. With all the benefits, there must be a few shortcomings or drawbacks, too. For instance, if you invest in properties and you hold on to them, you are potentially limiting your liquid cash flow. Typically, you can’t just use the cash you have tied up in the asset. While it is not usually a big deal, should you encounter certain emergency situations, this could pose a problem. Especially if refinance is not an option due to high interest rates.

Also, because your money is tied up in real estate, its value will vary based on the health of the market – both for selling and renting. Should the market take a downward turn, you may find the value of your property going with it.

Finally, owning real estate means also having to care for it. So when things go wrong, such as a leaky roof or a leaky toilet, you are going to have to take care of it. Though hiring a property management team to care for and maintain the property regularly may reduce the incidence of expensive repairs.

 

Knowing When to Sell

You may have an entire portfolio full of buy and hold real estate purchases, but that doesn’t mean you can just shove them aside and hold them forever without ever giving a second glance! Hence why it is not dubbed a buy-and-hold-forever investment strategy.  There is a time to sell — and in order to protect yourself, you need to know when that time is.

Selling when the time is right is going to be a personal decision based on your own set of circumstances. However, there are a few factors that may have you considering:

  • The state of the market. Keep an eye on the comps. When you see the sale prices going up you may want to consider letting it go.
  • Do you see an area or market with better opportunities but need the cash? Consider selling and then reinvesting in that area.
  • If property taxes are on the rise, does it make sense to keep the property? Will you still benefit despite the higher taxes?
  • If the rental market is slowing down or rental rates are no longer steadily rising, it may be better to sell and reinvest in another location if you choose.
  • Maybe you have found you are terrible at dealing with tenants and can’t afford to hire a property manager based on the income the property is producing.

Investors are always looking for the next investment option — and monitoring their current investments. Don’t shove these aside and forget them. Monitor them regularly and make the best decisions for your property.

 

How a Property Management Team Can Help

Your mind may be focused on buy and hold investment opportunities – and that is exactly where it should be. See, many investors engage in this investment strategy and then find themselves holding all these properties without knowing where to start.

This is where a property management company like Real Property Management Evolve can step in and take over. You continue looking for investments – or do whatever you wish – and your property manager will get your property advertised and rented to high-quality tenants, handle any maintenance and repair, rent collection, and so much more.

Property managers are experts in managing rental properties. So as you are buying and holding property, you can rest easy knowing that in that holding phase, you are maintaining low vacancy rates and a healthy passive income. It just makes sense for your investment.

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Property Investments

6 Reasons to Invest in Arizona Rental Properties

If you’re looking to diversify your portfolio, you may want to consider investing in Arizona rental properties as there is so much growth potential. Here’s what to know.

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As an investor, you make moves. You strategize, network, inquire, and never cease to find the best investment for your future. When it comes to buying Arizona rental properties, you know that there are certain criteria you look for before you go any further.  For instance, you want to make sure that the market is thriving and that the return on your investment will be worth it.

Thanks to property management companies, you can buy rental property anywhere in the country – and you don’t have to reside nearby. However, if you are looking for one of the hottest places to plant your rental roots, Arizona may be exactly what you need. And we’ve got 6 reasons why.

 

1. Employment Rates Are High in Arizona

The coronavirus pandemic hurt many people due to closed businesses, lack of business, supply chain issues, layoffs, furloughs, and more. The unemployment rate soared nationwide. Some areas have struggled to recover, but Arizona has not. In fact, the employment rate clearly shows that people are getting their jobs back – or finding new ones.

What does that mean for you as an investor? It means business and the economy are both healthy. Employees likely have money to pay you rent. And, those who cannot find work in other areas may find themselves in Arizona to take advantage of the available work.

 

2. Landlord-Tenant Laws in Arizona are Landlord-Friendly

Engaging in fair and appropriate rental practices is necessary to keep yourself out of hot water and ensure the rights of everyone involved are properly met. However, there are some states that make it, well, difficult to be a landlord. For instance, if you have a non-paying tenant, landlords find that evicting that tenant from the property is a hassle and involves jumping through a lot of hoops.

In Arizona? If you have a tenant who has not paid rent or is behind in rent and has defaulted based on the terms of the lease agreement, then you, as the landlord, are entitled to an easy and quick eviction process.

 

3. Arizona is Seeing Incredible Levels of Growth

There are certain cities in Arizona that are seeing an abundance of growth. And, the Phoenix metro area is number 7 on the list of most people moving in from other states. In other words, it is really beginning to make its name known – Phoenix has a lot to offer its residents.

Maricopa County (home to the Phoenix area) is one of the largest counties in the country. Yet, it is still affordable for landlords and tenants. But with so much growth activity, it may not be long until things start getting a little more expensive here. So, getting in now may be a very good idea.

In addition, Phoenix has been dubbed “the new silicon valley“. As tech giants like Facebook, IBM, Intel, and Amazon expand in the valley of the sun, their employees are bringing cash to fund their large real estate purchases. The growth is simply not slowing down ad more and more tech workers call the Sonoran Desert home.

If you are interested in the Phoenix area, investors are encouraged to look at all surrounding cities and suburbs as the metro area here is spreading greater and wider.

 

4. Properties are Still Affordable

It is a lot easier to make a decision on an investment when the risk is minimal, isn’t it? While the home prices will vary based on the area and amenities, compared with other places, the homes in Arizona are affordable. Though, we should note that an investor should never just blindly invest in a rental property just because it is affordable. Combining all the other reasons to invest in Arizona rental properties along with the affordability factor means you may very well have a great investment.

 

5. The Rental Vacancy Rate is Low – Historically Low

When it comes to buying Arizona rental properties, buying something that seems like a great deal won’t do you much good if the rental market has a high vacancy rate.

The vacancy rate tells you just how many rentals are not currently occupied at any given time. The lower the vacancy rate, the better it is for investors. It means that the rental properties that are in Arizona are rented by tenants – and earning money.

We suggest including a 5-10% average vacancy rate in your underwriting. Figure at least one month per year your rental property will be vacant while you place a new tenant. If you have a tenant that stays longer than one year, you just gained a full month of cash flow you didn’t even count on getting! Always hope for the best, but plan for the worst.

 

6. The Best Property Management Services

Investing in rental property is one thing. Managing that property in the role of a landlord is entirely different. Landlords have to deal with a lot. Finding and screening tenants, looking for high-quality individuals only, requires experience. Being available all hours of the day and night for emergency repairs takes time and patience. Being able to handle routine repairs and inspections means having knowledge in various special trades. And then there is rent collection, document management, monthly transaction tax payments, yearly tax preparations, registering with the county, walk-through inspections, showings, and much more.

Being a landlord may sound like a great idea in theory, but, when it comes down to actually doing the work, it is tough. And time-consuming. Which means less time focusing on your investment opportunities.

Property management teams work to care of rental properties throughout the entire process, freeing up the investors time – your time – so that investment portfolios can continue to grow and flourish. And, the best property management team – the one found at Real Property Management Evolve – is located in Arizona. The Phoenix metro area to be more specific.

This is just one more reason why investing in Arizona rental properties just makes sense. The experts are there, so you may as well use them!

 

Investing in Arizona Rental Properties

As an investor, you know that there are many things that you must take into consideration when investing in Arizona rental properties. You know that there is not just one thing that makes or breaks a deal, but rather a number of factors.

As you experiment with what works for you, then you will learn how to tell which properties and which areas make the wisest investments. Currently, though, experienced investors around the world have their eyes on Arizona. Places like Phoenix, Glendale, Mesa, Scottsdale, Queen Creek, Buckeye, San Tan Valley, Peoria, and more are all areas that are seeing a rise in interest and investment activity.

Wherever you choose to invest, just make sure you have access to an experienced property management team to take care of the day-to-day business of your property as you focus on that investment portfolio.

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Property Investments

Phoenix Real Estate Market Trends Every Investor Should Know

As a property investor, it’s essential to understand the latest Phoenix real estate market trends to make better investment decisions. Here’s what to consider.

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Being a real estate investor involves more than just investing money. Well, that is assuming you want to be a successful investor.

Paying attention to the world around you – the bigger picture – gives you a bit more insight when making investments. It means being able to understand the Phoenix real estate market, market trends, future predictions, and so forth. The more you learn about what is going on, you get a greater sense of when you should make an investment and when to walk away.

If you are an investor in the greater Phoenix area, then there are a few Phoenix real estate market trends you should know about.

Local Financial Health is Heading in the Right Direction

As investors, we want to make sure that the area we are investing in is thriving – or has a positive outlook at the very least. And the greater Phoenix area has that. Foreclosure and mortgage delinquency rates are lower than the average nationwide – and so is the unemployment rate. Home prices are going up – and so is the median rent price, coming in at just $1,587. And while this is lower than the national average, it is higher than what it was in Phoenix last year – up by 8.4%.

The Rental Vacancy Rate is Looking Good

Looking at the local renters market – especially the rental vacancy rate – is important. If the vacancy rate is too high, it could signal that the demand just isn’t there. But, currently, in Phoenix, that is not the issue at all. In fact, the rental vacancy rate is currently 3.9% – which is lower than the national average and low for the Phoenix metro area, too.

Do you know what that means? It means that for those choosing to purchase a rental property, there is a good chance that you will have no problem renting out your property to tenants, with very little downtime.

New Construction is a Mixed Bag

With construction costs on the rise and the loss of construction jobs, there is an indication that the construction industry with Phoenix is struggling. It has been reported that costs are up 6.7% and approximately 1,300 jobs were lost.

By looking at the permits, we are able to see that the people of Phoenix want that new construction number to go up. Permits for single-family homes are up immensely. But that’s not all – multi-family properties are on the rise, too. Looks like there could be some positive turnaround for new construction in the near future.

Phoenix Real Estate Neighborhoods to Keep an Eye On

The Phoenix metro area is huge, encompassing some growing areas, too. It is important to take a look around at the areas that appear to be doing well and growing — and find those that are gaining recognition and new residents.

After all, the more growth in a neighborhood, the better chance you may have with your investment. Here are a couple of areas to monitor.

  • East Mesa / Queen Creek / San Tan – It’s no surprise for any resident living in Phoenix to hear the East Valley is growing like crazy. As major tech companies expand into the wide open desert spaces available in the East Valley, new homes are being built and existing home prices are starting to increase. Rental prices in this area are still exceeding mortgages.
  • Buckeye – We can all agree that COVID changed a lot in our country. One of the trends we noticed during this time was a shift in location for new home buyers. We have seen more home buyers looking in cities like Buckeye as they can purchase larger homes with ample land space for the same cost a downtown high rise. In addition, cities like Buckeye are starting to bring in larger companies establishing their manufacturing facilities in this area. More jobs in the area = more profit for investors like you!
  • Happy Valley / Surprise – Another great area with more tech companies, and manufacturing facilities building new spaces. This area is expected to see an increase in new jobs by over 10,000 in the next few  years!

Keep in mind that there are all sorts of neighborhoods throughout Phoenix, as well as in the surrounding areas of Gilbert, Mesa, Peoria, Scottsdale, Tempe and more. You are sure to find what really works well for you, your interests, and your investment style.

The Job Market is Alive and Well

Many major industries like to call Phoenix home. And Fortune 500 companies make up a big part of that. With the unemployment rate down, it seems like things must be moving in the right direction. The economy of the Phoenix metro area is propelled by the following healthcare, finance, tech, and retail companies:

  • Magellan Health and Banner Health employ a large number of residents (over 10,000), as well as Dignity Health, Phoenix Children’s Hospital, and the Mayo Clinic.
  • Three main companies bring the greatest presence in the area, Avnet, Amazon, and Honeywell.
  • This is a busy sector in the Phoenix area. Big corporations such as American Express, JPMorgan Chase, Bank of America, Wells Fargo, and Charles Schwab are all found here.
  • There are a couple of retail giants that have their headquarters in the Phoenix area. They are Petsmart and Sprouts Farmers Market.
  • A lot of jobs – and a lot of students – come from the education sector in Phoenix. And, it includes Arizona State University, the University of Phoenix, Phoenix College, and Grand Canyon University.
  • We can’t talk about jobs without talking about the Tech growth! IBM, Intel, and even Facebook are all establishing operational facilities in the Phoenix metro area. Phoenix has been labeled “the new Silicon Valley” of the southwest.

Is Phoenix Right for Your Investment?

The sign of a good real estate investor is one who looks closely at all the opportunities available and all the data that support those opportunities — and then chooses the best choice. You can go anywhere in the world to invest in real estate, but why would you when the market in and around Phoenix is looking so fantastic right now?

There are a lot of opportunities for growth seen with these Phoenix real estate market trends. Lots of space and signs of new construction, a growing population, a stimulated economy, and more.

The future is looking bright for investing in Phoenix and the surrounding metro areas.  And, if you decide to take that leap, you will feel confident that you will find the best property management company to handle your investment right here in the local area.

At Real Property Management Evolve, we understand the local Phoenix real estate market and follow the trends closely. So, whether you are interested in investing in rental property in Mesa, Glendale, Scottsdale, Tempe, Phoenix, or the surrounding areas, it is probably a wise decision. We know how successful rental properties are doing right now in the area — and are very optimistic about the future.

For a FREE assessment of any rental property you are considering purchasing please contact our team at 602-295-4661.

Categories
Property Investments

3 Tips to Increase Passive Income on Your Multifamily Property

As an investor, owning and renting multifamily property can be a great way to diversify your portfolio and bring in passive income. Here are three tips to help you succeed.

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Passive income is income that is earned without having to actively work at it. It doesn’t require a lot of your attention or time, yet it is still earned income. Focusing on investments that allow you to continue earning money with passive income can be a fantastic way to earn money now and in the future.

Once such type of investment is multifamily property. Though, your actual passive income will vary based on how much involvement you have in the property.

Looking to increase your passive income on your multifamily property? You need to make it more desirable. Let’s take a look at 3 tips to increase passive income on multifamily real estate.

 

1. Increase the Value of Your Multifamily Property

In order for you to make money on rental property, you need to have renters. And because there are often so many options on the market, showing there is great value in renting your property may entice the potential tenant to lean toward your rental.

It is important to mention that the more value you add, it is easier to keep your rentals priced closer to the higher end of the market range. Renters will be able to justify the extra money each month due to the great value and amenities they are receiving from the property.

So, how can you increase the value of your multifamily property?

— Add Storage Space 

Storage space is something that many people are always looking for. Especially renters. Moving from one location to another – especially smaller apartments – means having stuff that doesn’t necessarily fit. Rather than get rid of it, millions of people throughout the country spend between $50.00 to $150.00 each month for storage.

Does your multifamily property have additional space to build storage? Storage facilities are incredibly cheap to build and can add a lot of value. Plus, not only can you entice renters with convenient on-site storage, but you can charge them a monthly fee for the storage as well. It could be a great investment. And a great way to increase your passive income.

— Add On-Site Laundry Facilities

Many,  but not all, multi-family properties don’t come with a washer or dryer in the unit – or even a hookup. This means having to carry dirty laundry to the nearest laundromat. It can be seen as a great inconvenience. If possible, add an on-site laundry facility. The value of this investment is immediate and can add to your passive income, as well. Instead of your tenants going to other places in the community to do laundry, they can conveniently do it where they live and you can earn the money they paid to wash and dry. In addition, a lot of companies who lease the washer and dryers will give a signing incentive up to $14,000 when you lease their equipment!

— Be Pet Friendly

People love their animals – and they want to be able to take them wherever they move. For many, not allowing pets can be a deal-breaker. If you’d like to increase the value of your property and increase your ability to earn passive income, then deciding to be pet friendly means allowing your tenants to have pets. In addition, building a dog run on your multi family can help contain the pet mess while providing an extra amenity to your tenants. Remember — you can charge pet rent on top of the normal monthly rent.

-It’s a win-win for both parties.

 

2. Add Safety Features to Your Multifamily Property

People want to live somewhere safe. They want to know that when they are home or on the property that they are safe and secure. Taking steps to increase the safety of the property means adding additional value in it — and potential tenants will see it. In addition, you reduce the incidence of any vandalism and theft on the property so that your replacement, repair, and insurance costs remain low. All of this ties into your income – and leaves you with an increased passive income.

Here are a few ideas for increasing the safety features:

  • Make sure you have adequate lighting throughout the property – and add more if necessary.
  • Keep bushes trimmed to minimize hiding spaces for intruders.
  • Consider adding security access points, whether through a gate, a door with a key code, etc. This will depend on the setup of your property.
  • Avoid glass doors. These are easy to break — and costly to replace.
  • Use top-notch locks on doors and windows to make accessing the property harder for criminals.
  • Make use of security cameras on common areas of the property. Put up signs advising of such – and let your residents know, too.

 

3. Hire a Property Management Team

Hiring a property management team to handle your property for you is one of the best steps you can take in increasing your passive income. Why? Well, there is a lot that comes with managing a rental property. When you have a multifamily rental property,  you are multiplying that work times the number of units you have. This can significantly increase the volume of your work. From finding new tenants, rent collection, repairs and maintenance, and so much more — you are actively involved in earning that income. Being a landlord is much like having a job. And with many units, it can be a very demanding job.

The idea with passive income is to earn money without having to put in the effort. This is where a multifamily property management companies come in. See, the property management team will put in the work to get the property rented, maintained, handle repairs, rent collection, all the marketing and paperwork — every aspect of the rental process. While you sit back and earn the income. That is what passive income is all about — and how a property manager can help.

 

Conclusion

Being a landlord can be a lot of work – and surely reduces the amount of passive income you receive. If you are ready to increase this income and be able to focus your attention on other investments rather than managing the day-to-day of your multifamily rental property, then you need to make your property more valuable, keep it safe, and hire a property manager.

And, since we are on the topic – you can’t just hire any property manager. Be sure that it is the best one in your area, such as Real Property Management Evolve in the Phoenix area. This breeds confidence and increased passive income.

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Property Investments

Passive Income Real Estate: 6 Considerations to Know

Passive income real estate is a great investing strategy that allows you – the investor – to generate revenue without being actively involved. Here are 6 things to consider.

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Investing in real estate doesn’t always lead to a get-rich-quick sort of deal because there are so many variables, including one’s strategy and investment technique. But one thing is for certain – if done right, real estate investments can lead to a great source of passive income.

Passive income refers to earnings received without much, if any, active involvement. Who wouldn’t prefer to have a steady stream of money flowing into their bank account without having to put in a lot of work – if any at all? As with anything, though, it is important to fully understand what’s involved in passive income real estate. After all, there is no such thing as a free lunch.

Let’s take a look at 6 considerations you should know about passive income real estate.

 

1. Choose Your Strategy

The more you practice something, the better you get at it. If you begin investing in real estate or rental property, look at all your options and decide what will work best for your portfolio, your plan, your future, etc. Is it single-family homes? Are you more interested in buying multifamily properties? Maybe even commercial properties?

You cannot successfully reach the finish line if you don’t know where you are going or how you are going to get there. Before you dive in, secure your future passive income by having a strategy to obtain it.

 

2. You Will Still Have to Put in Work

While passive income generally means that no active involvement is required, you will have to put in some work. Issues and repairs will arise, routine maintenance must be tended to, and every time you have a vacant property, you will have to find a new tenant. Does this still make it passive income? Yes.

You will not constantly have to be involved. Owning rental property is not like having a full-time job, per se. Though, truth be told, if you have enough units, it very well could be.

 

3. Create a Well-Rounded Portfolio

Have you ever heard the phrase – Don’t put all your eggs in one basket? If that basket tips or drops, you are sure to lose all your eggs. When investing, it may be a good idea to create a well-rounded portfolio that allows you to keep your eggs spread around a little bit.

This could be about location, type of property, or the means you use to invest in it. Talking to professionals in the industry can help you to see new ways in which you can handle your own investments.

 

4. Approach Passive Income Real Estate Investments with a Business Mindset

You should always approach passive income real estate investments objectively and with a clear mindset. Do your market research, get a clear understanding of how your investment will impact your portfolio – and your future ability to receive passive income. If something doesn’t go through, it wasn’t meant to be. Move on to the next one.

Every investment you make should be with your mind, not your heart — and only after carefully calculated market trends.

 

5. Know How You Will Invest – And Your Timeline

You cannot jump into investing without having a plan – especially since each type of investment is different from the next. So choose your funding source wisely. And, if you are using money that you may need in the future – or are counting to have as part of your retirement, for example, be sure that your timeline fits. In other words, if you need your money back within 10 years, make sure you are making an investment that will allow you to have that money back within the time frame.

Investing doesn’t only involve looking at the current situation, but it absolutely must involve looking at the future. An investment may look great at the moment, but will it have long-term benefits for you? Will you be risking money you shouldn’t to purchase that investment?

There are so many things to consider when it comes to investing. The more careful you are and the more on-point your future predictions become, the greater chance you will set yourself up for success.

 

6. Seek a Professional Property Manager

The idea of passive income real estate can sound wonderful. The more you invest in rental property, the more you are likely to see it is not so passive after all. There is often a lot of work to be done to manage rental property, keeping quality tenants in a healthy rental property takes dedication and work.

When repairs are required, you need to address them. Even if it means calling someone to fix the problem, you are still getting the calls throughout the day. Routine maintenance is important for maintaining the longevity of your property. Finding/keeping tenants – and all that goes along with that process can be time-consuming, as well. And that’s just a few things that will require your attention. Although it is not a regular “job”  it does still require work.

That is, of course, unless you hire a local property manager.

Property managers are professional at handling rental properties – and everything that comes with them. That means property management marketing and advertising, finding and screening new tenants, handling routine maintenance and repairs, rent collection, and more.

What does this mean for you? If you have an experienced property management team – like the one at Real Property Management Evolve – then you can truly feel what it means to earn passive income with real estate. You will not need to do a  thing because your management team will handle it for you. You will simply collect the income from your investment.

 

Is Passive Income Real Estate in Your Future?

If you are looking for ways to set yourself up for a bright future – and maybe even some retirement income – passive income real estate investments may be an option for you. Before you jump in, though, you must consider all of the factors and all of your options.

And, if you choose to move forward with it, make sure you truly keep that income passive with the best property management team in the greater Phoenix area – Real Property Management Evolve.

    GET A FREE RENTAL PROPERTY ANALYSIS TODAY    

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Property Investments

7 Reasons to Invest in Long Term Rentals Over Short Term Rentals

When investing in properties, there are many options to choose from. Here are 7 reasons to consider investing in long term rentals and properties over short term rentals, vacation rental properties, or month-to-month properties.

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As a landlord or property investor, you know that one of your goals is to reduce your vacancy rate and keep your units occupied. After all, if they are sitting there empty, they surely are not bringing in any money, are they? That’s why when a property has been vacant for any length of time, it may make you want to want jump at every opportunity to get some cash flowing again.

Here’s the thing – short-term leases, vacation rentals, or month-to-month rentals may sound better than no rental at all. But, we’ve got 7 reasons why you should invest in long-term rentals. Check them out.

 

1. The Demand is There for Long Term Rentals

People will always need a place to live so there will always be renters. There is no need to put yourself through the hassle of short leases. Besides, research is starting to reflect an increase in the number of renters — so the rental market is high in 2021.

 

2. Long Term Tenants Equal Less Work For You

Tenants that are in and out quickly will mean more work for you. Cleaning and maintenance between tenants/guests along with paperwork, tenant screenings, and so forth. If you decided to invest in rental property as a means of securing a form of passive income, short-term rentals and such may not make sense.

 

3. Long Term Tenants Give You Consistency in Income

Speaking of income – with a long-term lease, you have consistent income over, at least, a 12-month period. You will get your tenant screened, the lease signed, and then collect the rent. Unless, of course, maintenance or repairs are needed. Regardless, it is a monthly fee you can rely on.

 

4. Long Term Rentals Provide Low Vacancy Rates

Believe it or not, the vacancy rates are higher for short-term and vacation rentals – by a lot. If your property is not rented now, you may feel as though your rate is going to go up. But, realistically, once your unit is tenant-occupied with a long-term lease, you will not have to worry about that rate again for at least 12 months or so.

 

5. Long Term Tenants Cause Less Wear and Tear

With short-term rentals, you will be expected to furnish the property with nearly everything one may need while living there. This includes furniture, televisions, linens, small appliances, dishes, pots and pans, and so on. With each new tenant, you will need to make sure everything is in presentable shape and working order.

If not, it will need to be replaced. This could get expensive. Not to mention the hassle of having to keep it looking great for the next guest. Remember, the expectations of your short-term guests will be high.

With long term rentals, tenants will bring their own furniture and their own dishes. You provide the bare rental and they will move in with their belongings. This puts less strain on you. Sure, you will have to check the property when the lease is up and there may be some minor wear and tear, but nothing like you would see with vacation rentals.

 

6. Long Term Tenants Take Better Care of the Property

Even if you don’t find the most high-quality tenants out there, long term tenants tend to take care of their homes better than a guest does at a vacation rental. They live there and they want to be proud of where they reside. Any issues, they will call you or take care of the issues themselves. Short-term summer renters? Not so much.

 

7. You Won’t Have to Worry About Reviews with Long Term Tenants

The internet is a wonderful tool. But, for those trying to please guests and short-term tenants at vacation properties, the internet can quickly turn into a nightmare. Some companies hire a person or department for the sole purpose of keeping the peace online because one or two bad reviews can really put a damper on your business.

Sadly, the reviews may not even be accurate or they could be the result of an over-demanding tenant. Even so, the world will hear about it — and you will be left to pick up the pieces or try to make things right.

Long term rentals have long term tenants. They aren’t usually leaving reviews of their landlord online so that’s one less thing for you to worry about.

 

Are You Still Leaning Toward Short Term Rentals?

If you have read these 7 reasons to invest in long term rentals and you are still focused on short-term vacation rentals, that’s ok. We each have our own interests, investment strategy, and goals. It works well for many people – and it may very well be rewarding for you, too.

If you ever find yourself overwhelmed with the process, though, just know property managers may be able to help you with short-term leases. Not all provide this service, but it is worth looking into.

 

Keep Your Units Filled with Long Term Tenants

If you find that you are struggling to get your long term rentals occupied, consider changing up a few things. Take a look at your requested rental rate. Is it reasonable? Does it fit the area? Check around at comparable rentals and make sure you aren’t coming in too high.

Next, switch up your advertising and property marketing methods a little bit. Maybe you are not reaching the right audience? Maybe you aren’t even having those seeking rentals see your listing? Change the wording of your listing, throw in some fresh pics. Sometimes giving it a little online makeover may help.

Finally, seek the professionals. Hiring a property manager may not be something you have considered, but when it comes to getting properties rented, well, that’s what they do. The best property manager in the greater Phoenix area – Real Property Management Evolve – knows that to successfully rent properties, you have to have the right strategy. And, when you’ve spent your life honing those skills, then you know how to keep that vacancy rate down — and long term rental agreements signed.

    GET A FREE RENTAL ANALYSIS TODAY    

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Property Investments

How to Buy a Multifamily Property: 5 Pros of Multifamily Investing

Multifamily investing is a great way to diversify your portfolio and increase passive income, here is how to buy a multifamily property, and the benefits of doing so.

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People are always looking to invest in rental property, but those who have never taken the leap often don’t know where to start. After all, there are so many options, such as single-family homes, multifamily properties, commercial office space, retail space, hotels, and more.

Where do you start?

Of all the options, multifamily properties tend to be one of the easiest, most straightforward methods of investing in rental property.

 

What is a Multifamily Property?

In short, a multifamily property is one that has more than one unit.

When referring to multifamily properties, it is not uncommon to think of massive high rises or large apartment complexes. After all, these are places where you have many families residing within one building. But multifamily homes can come in all sizes – including a two-family duplex. Tri-plexes and four-plexes are also multifamily properties, housing three and four families.

Smaller multifamily properties are still considered residential property. But, when there are five or more units, it is often referred to as a commercial real estate.

 

5 Pros of Multifamily Investing

Some investors believe that multifamily properties are the way to go. You buy one building and have multiple tenants – it must be a great investment, right? As long as you are making a well-strategized purchase, you will find that there are many benefits to multifamily investing. These include:

1. Create passive income.

As with every rental investment, passive income becomes a great way to bring in money without having to give it much time and attention. This is even more true when you hire a property manager to handle your properties.

2. Increase cash flow.

When you have multiple properties, you have multiple incomes coming in on one property and it can generate an increase in cash flow for you. When you are ready, you can even take this increase in cash flow and invest it in another property.

3. It’s a low-risk investment.

If you have money that you need to invest, but you want to do so safely, then the multifamily investing is a great option. People will always need a place to live.

Even if they are forced to sell their home and move into something smaller, they need a roof over their heads. So no matter how good or bad the economy gets, there is always a good chance of demand.

4. There are many tax advantages.

One thing that sets multifamily rental properties aside from others is that they come with many tax advantages that others don’t. This primarily comes down to depreciation offsets.

5. You only need one loan.

When you buy multiple properties, you will have multiple different loans which can be tedious in tracking and managing over time. However, with multifamily investing, you will only have to worry about one loan on the property of multiple units. When you have a lot on your plate, this can simplify things a bit.

 

How to Buy a Multifamily Property

Once you get your mind set on purchasing a multifamily rental property, you are going to need to know how to do it. You could move in the traditional sense and take out a mortgage. This, of course, means going through various applications and providing the right documentation to get approved. If you are intending to reside in one of the units, you may even qualify for an FHA or VA loan. Be sure to check with your bank or lender to determine your options.

Private money mortgages are another option. If you know a financial backer who isn’t too big into the details of investing but is willing to give you the money to invest, this is another option. Sometimes money may even come from friends or family members who want to act as silent partners in your multifamily investing adventures.

If your investment funds are too high, you can even consider buying cheaper properties using the BRRRR method and rehab them a bit. You may be surprised at how much money you could save — if you have the time and skill to renovate.

Multifamily property investors often have a lot of different strategies they use for determining the best properties or making the best use of funds. Expand your network and learn from those who are already doing it.

 

Utilize a Property Manager for your Multifamily Properties

While there are many reasons to begin multifamily investing, there is one downfall that we have not discussed – and that’s how difficult they are to manage. For investors who aren’t experts at managing more than a rental property or two, having a multifamily unit with multiple tenants – and all the issues that may arise – can be overwhelming and frustrating.

This is where multifamily property management comes in. You can’t let the trials of handling multiple tenants deter you from making a sound investment in a piece of multifamily real estate. Instead, you need to make wise decisions to invest and then delegate the work.

Experienced property managers are able to handle your multifamily property with ease, freeing you up immensely. And hiring one just makes the most financial sense.

A property manager will handle:

  • Marketing your property
  • Tenant screening
  • Showing the property
  • Lease signings
  • Maintenance and repair
  • Walkthroughs and inspections
  • Evictions
  • Rent collection and distribution

And so much more. They understand everything that it takes to successfully manage rental properties – and that’s what they do. At Real Property Management Evolve – the best property management team in Phoenix – we know handling a multifamily property can be overwhelming for the most seasoned investors. That’s why we manage your property so that you don’t have to.

Buying and renting a multifamily property is a great choice to make as an investor – especially because the benefits of doing so are plentiful. But once you do, just know that managing multiple units is much more difficult than you may expect. Reach out to an experienced property manager – such as Real Property Management Evolve – to handle the property for you. It pays to have the experts on your side.

    GET A FREE RENTAL ANALYSIS TODAY    

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Property Investments

Becoming Real Estate Investors: 5 Ways to Get Started

Choosing to become real estate investors can be a fantastic way to increase passive income, here are five tips to get started.

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Investing in real estate takes a plan and skill. While blindly taking your money and randomly investing it in properties just to invest may land you a nice profit, the likelihood of this happening is pretty slim.

Real estate investors know that investing involves a strategy; and if you want to get started investing, you are going to have to have a strategy of your own.

Most investors will suggest that you start small, with REITs or crowdfunding, and then work your way up. It is less risky and helps you build up your portfolio and your capital, too. Jumping head first into flipping houses could leave you feeling overwhelmed – and in over your head.

Keep it simple and build your strategy. It is ok to start small.

Below are 5 ways to get started as real estate investors. Look at your skills,  your available funds, and your experience – and decide which option would work best for you.

 

1. Short Term or Vacation Rentals

The idea of vacation rentals and websites like Airbnb and the like are very popular these days. Those who are traveling find it more enjoyable to stay with a short-term rental or vacation rental than to stay at a hotel. You usually get a more homey feel, more amenities, and a better overall experience.

As you are getting started in real estate investment, you may want to generate some real estate income without having to do any real investing. Or maybe you need to generate the income for investing. If this sounds like you,  you could get your feet wet by offering up a room for rent or even listing your property for a vacation rental on certain days of the week or times of the year.

Although this investment model can be very easy and profitable, there are always downsides. For example – there are people who rent Airbnb’s simply for the sole purpose of throwing a huge party that will destroy your home. Using a professional management company for your short term rental can help protect your property.

 

2. Buy REITs

REITs or real estate investment trusts involve you investing in trusts – not the physical property. REITs are like the mutual funds of real estate because they consist of large companies that own huge pieces of property (think office buildings, hotels, apartment buildings, etc). And they pay dividends.

No, REITs are not the way you are going to get rich on real estate investing, but they are a good place to start for someone just trying to understand what it is all about. In general, publicly-traded REITs can be a sound investment choice.

 

3. Flipping Properties

If you have spent your Saturday afternoon watching HGTV, then you’ve probably thought, I wonder if I could do that? Show after show has couples buying run-down, forgotten properties and turning them into breathtaking masterpieces. Updated features, flooring, paint, remodeled bathrooms, and kitchens, etc. are all part of transforming a property.

Truth is, flipping properties is not necessarily as easy as it looks on television. First, how good are you at carpentry, plumbing, or electrical work? Do you know someone who is? Or will you have to pay an outside company to handle the work for you? Will you even know if that company is doing a good job, or cutting corners that will cost you later?

Even more, are you able to look at an investment and have a good idea of the costs it will take to renovate the space? And then, of course, you will have to compare all your investment costs with the market rate for re-selling the property. Will you make a profit? Is it a good deal?

Flipping properties involves a lot of strategy and calculations. It can make you a lot of money, but it can also cost you if you don’t know what you are doing.

 

4. Real Estate Crowdfunding

Real estate crowdfunding is investing in a group of others on either debt or equity. Debt investing means investing in a mortgage loan on a piece of property – then receiving a share of it when it is paid back. Equity investing means investing in the actual property and sharing ownership. You will receive money in however the property generates it.

While it may seem similar to REITs, crowdfunding for real estate investors involves investing in a project of your choosing and the minimum investments are usually higher. Because it is one piece of property, rather than investing in a collection, this type of investment is a little riskier.

 

5. Invest in Rental Properties

When you first think about investing in rental properties, you likely think about all landlords have to go through — and want to run the other way. But there is a huge difference between being real estate investors and being landlords.

Did you know that you can invest in rental properties, but leave the managing of the property to someone else?

Property managers are experts in handling rental properties. They can do everything from getting a rental property in shape to rent, marketing and advertising the property, tenant screening, lease signing and document management, routine maintenance and emergency repair, rent collection, inspections, monthly accounting documents, and more.

This means that you can focus solely on your investment portfolio while someone else helps you bring in the income by managing your properties. And, if you are new to real estate investing, this may be your safest option to get in the game.

When you are ready to jump into real estate investing you need to have a clear goal of what you are seeking — and how you are going to obtain it.

If investing in rental properties is your go-to method of investing, then Real Property Management Evolve may be able to help. Known as the best management company in the greater Phoenix area, your rental properties will be in good hands.

You can keep honing your investment skills and let Real Property Management Evolve do the rest.

 

Final Thought

Well, now you know available to start as real estate investors – short-term rentals, REITs, crowdfunding, flipping houses, or rental property investments. Dig deeper into each, reviewing the pros and cons. Then weigh your options with your skill level and determine what your first move should be.

Then, put your real estate investment strategy together. It’s time to do some investing!

“Ninety percent of all millionaires become so through owning real estate.” – Andrew Carnegie