Flipping houses is a great way to generate either active or passive income, but the reality is that the income earned from house flipping is inconsistent– and that’s the best-case scenario. Flipping houses is a high-risk investment strategy with great potential, but it’s important that investors know that the profit doesn’t come instantly. Sometimes it would take months, or even years, for them to realize a profit from a single flip.
To mitigate risk and ensure a more reliable income stream, have you entertained the idea of adding some rental properties to your real estate resume? Santa Monica rental properties are stable opportunities that produce long-term growth that is rarely matched by stocks or other retirement products. They are a better opportunity, especially if you are looking for sustainable investment.
While the popularity of reality television about house flipping has increased, these reality TV shows have created something of an unrealistic perspective on exactly what flipping houses entails. It is entirely possible to purchase, remodel, and re-sell a residential property quickly and profitably in Santa Monica, but the odds don’t favor that. It’s very common to bump into obstacles and delays.
For example, units that are under construction tend to be targeted by thieves and vandals, resulting in costly financial loss. On top of that, bad weather, burst pipes, or any other unforeseen events could result in expensive repairs that were not included in your original budget. This is the reason why house flippers need to prepare and be educated when it comes to dealing with unexpected events— both good and bad ones.
When it comes to flipping houses, even a best-case scenario flip would require a good number of months of work. The time involved in flipping a house can be extensive. First, you’ll need to find the right property, then arrange for financing and closing of the purchase. Then you can start remodeling the property and, when that’s done, list it for sale. While all this is going on, this entire time – however long it may take – the property is not generating any income, since the only profit an investor realizes from a flip comes after the property has sold. Other investors work on multiple houses flips in a single year. They must do this to be able to generate a substantial and steady income stream. But more often, houses are flipped one at a time, making it difficult to anticipate how long the wait is before that investment will finally pay off.
Since this is the issue, house flippers will greatly benefit from having more than one revenue stream. There are many opportunities available in the real estate industry, but when stability is what you’re after, the income opportunities offered by residential rental properties are generally better. The process of buying and renovating rental homes is comparable to flipping houses, but there are some definite advantages. As an example, when you buy a home to be used as a rental, investors can enlist the help of a quality property management company to do the grunt work for them.
When property owners work with a company like Real Property Management West San Fernando Valley, they are given expert market assessments on all prospective and current rental properties in Santa Monica, ensuring that investors have accurate information on rental rates, market value, and so on. Real Property Management can also present you with dependable home remodeling and repair experts, ensuring quality in the work done on the property. The team of professionals then takes the property to market to find the best tenants so they can provide consistent rental income to the investors. The investors can then use the saved time on more important things.
When all of these benefits are gathered together, it is obvious that using the services of a property management company is not so much of an added expense as it is a valuable asset on your real estate team. The professionals at RPM West San Fernando Valley can make the process of owning rental properties one of the easiest real estate investments you’ve ever made. It would free up your schedule so you could pursue your other favorite things of the real estate business. Don’t hesitate to contact us online or give us a ring at 818-727-0100 to know more about what we can do for you.
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