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Are You Worried About Buying An Income Generating Property? Relax People Do Rent!

Are we going to find a renter?

The number one fear for new property investors is finding a renter. ‘Who rents” is nearly always the first question I hear.

Why do people rent? Here are 5 reasons:

Renting Keeps You Flexible
When you rent, you can pick up and move almost whenever you want, with very little penalty (perhaps an early termination fee of some kind); when you own, selling a home can take a very very long time. You lose a lot of flexibility when you “put down your roots.” When you want to look for a new job, you’re restricted to looking in the geographic area around your home. If you ever get a job offer in another area, you have to go through the headache of selling your home before you can take advantage of it. If you rented, you could just end your lease, rent a moving truck (avoid U-Hauls!), and just go.

Someone Else Does The Repairs
When you own your own home, every time something breaks, you have to fix it. Every time something breaks and can’t be repaired, you have to fork over the cash to buy a new one. A new refridgerator washer or dryer can cost thousands. When you rent, hopefully your landlord will take care of all of your problems, fixing things that need fixing, replacing things that need replacing.

Owning A Home Is More Expensive Than It Looks
With renting, you do throw your money on rent because you never gain ownership of the place you’re renting. However, when you own a home, you also throw your money away on other fees and taxes that never go towards your home ownership. For example, you’ll pay property taxes, homeowners association dues, condominium fees, and any number of other fees associated to the area your home is in – none of which go towards the equity in your home.

Renters Insurance Is Much Cheaper
When it comes to home related insurances, renter’s insurance is ridiculously cheaper than homeowners insurance – oftentimes ten times cheaper.

Home Prices Can Go Down Short-Term
One of the cornerstones of the argument to buy a home is that home prices always go up eventually. The problem with this theory is the fact that while you can invest in the long term, reality forces you to live in the short term and in the short term the market can go down.

Related posts:

1. Are You Thinking About An Investment Property To Flip? What Are The Fixed Costs?
2. Closing Costs & Associated Fees When Buying A House
3. 5 Mistakes To Avoid When Buying A “Fixer Upper” As An Investment Property Part One
4. 5 Mistakes To Avoid When Buying An Investment Property
5. How Do You Make Money When You “Buy & Hold” An Investment Property?

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This entry was posted on Friday, November 20th, 2009 at 5:52 am and is filed under Investment Opportunities. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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