One of the essential principles to successful real estate investment is learning about it before jumping on board. You don’t dive into a pool without knowing the water depth. Neither should you dive into the rental property market without seeking expert advice. There are, of course, multiple sources, but one that we highly recommend is the book Building Wealth One House at a Time, 2nd Edition, by John W. Schaub.
According to Schaub, wise investing in single-family homes provides passive income and generates a steady cash flow. He not only shares the reasons why he believes single-family homes make the best investment, but he also sets the stage for how to do it. Beginning with tidbits like,
“You have to buy a house to make money. Just looking won‘t make you rich. Second, you can make thousands of dollars in profits every time you buy if you buy a house that someone else does not want.“
From identifying the factors that determine investment potential (population growth, demographics, local government regulations and zoning laws, and inflation) to a specific plan for building a portfolio of free and clear properties, Schaub shares advice for every step of the journey. For example, he advises using what tenants seek in a rental as a basis for choosing a property. Items like:
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- A house big enough for their needs in a safe neighborhood.
- A house in good repair with a landlord who maintains it.
- Fair rent and fair raises.
- Privacy.
- And last, but certainly not least, a house the landlord plans to keep –not sell.
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When you invest in a property that fulfills these desires, you start ahead of the game.
Schaub shares many invaluable tidbits of advice, such as:
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- Proximity to public parks, recreation, jobs, and shopping, as well as the school district rating, are contributing factors to a “good neighborhood.
- Don‘t buy too small – a 3-bedroom home with 2+ baths or larger will attract more tenants.
- Pay attention to the lot’s attractiveness – after all, it’s the lot that goes up in value.
- Homes in a neighborhood of primarily owner-occupied homes will attract better, longer-staying tenants.
- Signs that you should pass up the deal and keep looking include homes sold “as is” that will require a lot of pre-tenant work.
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Schaub‘s book includes chapters covering how to buy the house that will make you the most money and knowing its worth before you make an offer. He discusses how to borrow safely, borrowing without going to the bank, and attracting investors. Then there are the angles of when and how to sell, using an agent, or selling on lease/options. Schaub offers 21 chapters of detailed, easy-to-read information that will help both newbies and experienced investors to “Build Your Wealth One House at a Time.”
About Rentals America
Rentals America provides full-service property management for residential rental properties. Our team is completely dedicated to property management and we’re here to help landlords navigate the rental market.
