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Investing in rental properties can be a great way to supplement your income. Many people actually use this as a form of retirement income; the rent will help to pay for the property's mortgage, and once that is paid off, the rental income will be all profit. While it is a great investment opportunity, many people don't understand all of the work the work that goes into managing a rental property. You don't simply get to sit back and watch the rent checks come pouring in. You have to screen applicants, maintain the property, complete necessary repairs, and do many other things to keep your property in shape and your renters happy. So if this is something you're considering, here are a few things you should know about investing in a rental property. Condos/Apartments vs. Houses The first thing you should know about rental properties is the big differences between renting out a house and renting out a condo or apartment. To be as blunt as possible, apartments and condos in Birmingham, AL, are simply much easier to manage. This is primarily because the entire exterior of the property--the building's facade, the lawn, etc.--are all managed by a property management company. You don't have to worry about maintaining the yard or repairing any exterior building damage, like you would with a house. You simply have to worry about the interior of the condo that you have purchased. Houses, though more difficult to manage, do come with their fair share of perks. First and foremost, you can usually charge more for rent than you can for a condo. Additionally, the people looking to rent houses are typically at a more stable stage in their lives, and they're more likely to stay in the property for an extended period of time, rather than leaving as soon as their contract ends (if not before). Which property type you choose to invest in will depend on a number of factors--your budget, the time you have to put into the property, what's available in your area, etc. In the end, the choice is entirely yours. Screen Applicants Thoroughly When you're trying to fill an empty rental property, you may be tempted to accept the first applicant who comes your way. After all, an empty rental property is just costing you more money every month. However, it's important that you take the time to screen applicants thoroughly and only accept someone who you think will be a good fit. Having a renter that doesn't respect your property or your contract can end up costing you hundreds or thousands of dollars in repairs, and you'll just end up needing to find a new renter anyways. It's much easier to just let the property stay empty for another month or two in order to find the right applicant. Get Professional Help You may want to try to handle everything regarding your rental property on your own. While this is admirable, there are certain things that you will want to hire a professional for. For starters, when you're first creating a rental contract, it could be worth hiring a real estate attorney to go over the contract and ensure you're covering all your bases. You may also want to hire professional contractors for certain repairs, if you're not experienced with doing them yourself. If managing your rental property proves to be too much for you, you can also look into hiring a property management company. They will take care of all of the tasks associated with owning a rental property, and you have nothing to worry about. Before you start buying houses or condos in Birmingham, AL, to invest in as rental properties, make sure you're prepared for all of the work that comes with it.
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