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| Investment Property: Part 2 |
1. Lease Option
A lease option on a property offers the leasee the opportunity
to buy the property at the end of the lease term. Lease options
essentially offer a try before you buy trial period. If you are
interested in a building, you can lease the building for a
relatively short amount of time. This will give you an
opportunity to determine if the building is going to fit your
investment needs. If the building suits your needs then you can
execute your lease option and buy the property. Since a lease
option offers additional value, normally the leasee must pay
small fee for the option to buy the property.
2. Rent to Own
In certain scenarios you may find yourself interested in owning
a rental home for a short period of time, and planning to sell
the investment property after that time period. In such a
scenario you should consider employing the rent to own approach.
When you offer a |
house that is rent to own, you collect rent
from the tenant for the specified time period and the tenant
possesses an option to buy the house at a later date. The rent
to own approach provides you with rental income for the life of
the lease, and also affords you the ease of selling the house to
the tenant, avoiding the hassle of putting the house on the
market and finding a real estate agent to sell the house for
you. Renting to own essentially offers the same functionality as
a lease option to the tenant.
3. Eviction
Sometimes you will be faced with a tough situation. If tenant is
not paying the monthly rent then they must be evicted. An
eviction is never a fun process. In simple terms, an eviction
basically means the tenant is being kicked out of their space.
The eviction process involves legal paperwork and the local
courts. Of course, if you can avoid having to perform an
eviction then you should. However, sometimes your tenant leaves
you no other choice but to carry out an eviction and remove them
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property.
4. Buy a Foreclosure
Evictions are often accompanied by foreclosures. A foreclosure
occurs when the owner of a property is unable to meet the
monthly payments required by the mortgage agreement. In such a
case, the bank servicing loan will have to repossess the house.
This process is often thought of as a foreclosure. For those
looking to make a purchase in the real estate market, buying a
foreclosure presents a great opportunity to get a good property
that is relatively inexpensive. Frequently, those who buy
foreclosures do so a below market prices since the bank is
primarily concerned with liquidating the asset (the house) and
covering the liability. Buyers of foreclosures should be
forewarned that these properties might include additional
expenditures to repair the house. Not surprisingly owners who
cannot afford their own homes often leave their house in
disarray upon moving out of being evicted. Typically such house
can fixed up rather quickly and reintroduced to the market as a
rent to own |
dwelling.
5. Get Rich Quick
Investing in real estate property is not a get rich quick
scheme. Certainly one can become extremely wealthy by divesting
their interests in various investment properties, but achieving
fast returns on equity does not happen overnight. An investment
in real estate should be accompanied by patience. If you can
find a property that will offer positive cash flows after all
other expenses are taken care of, such as a popular apartment
building, than you will not only be increasing your wealth from
day to day operations, but you will also be creating equity in
the property. Such an ideal situation offers a get rich quick
approach to investment property, but such opportunities are hard
to come by.
Adam Smith is an informational author for 10X Marketing. For
more information on investment properties and renting to own,
please visit The One Minute Millionaire featuring Robert Allen
and Mark Hansen (Houston).
About the author:
None
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