PEI Real Estate Report - Rental Properties
There are many things to take into account when purchasing any property. There are three very important things to consider above all others when purchasing a rental property:
1. How much money can you expect to earn in rental income?
2. What are your fixed expenses and your variable expenses?
- Fixed expenses are things like property taxes, insurance, routine maintenance and repairs, as well as the cost of any property management services.
- Variable expenses are things that may come up suddenly like repairs to the roof, a new furnace etc. It's wise to set money aside for these unpredictable expenses.
3. Be aware that there are risks involved in owning a rental property. The property could sit vacant for a time where you will not earn any income. Your tenants could cause damage to the property and you may have to incur legal fees to resolve issues with problem tenants.
Rental property's can be great investments but they don't come without their pitfalls, just ask these guys!
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Posted by Joel MacDonald
on November 21, 2011