Four Good Reasons to Invest in Rental Properties

There are basic necessities that humans have: Food (including water), clothing and shelter.   Here are four good reasons to invest in rental properties:

Appreciation: Residential real estate traditionally appreciates 3 to 5 percent a year.

Cash Flow:  Money left over at the end of the month after all expenses are subtracted from income is cash flow. These expenses include mortgage payments, management costs, maintenance expenses, property taxes, etc.

Depreciation: Rental property investors can save significantly on their federal taxes by depreciating, over time, the amounts they spend to buy and improve properties.

Leverage:  The ability to make money using other peoples’ money is leverage. Residential real estate is renowned for its high leverage opportunities. Real property is excellent collateral, and lenders of all types and sizes underwrite mortgages for homeowners and investors alike.