What You Need to Know if You are Considering Investing in Rental Properties

February 6, 2021

One of the most frequent comments we hear from clients is that they’d like to have rental properties for passive income. What’s better than money that you don’t have to work for? And who wouldn’t want a steady stream of income in retirement?

While we agree that real estate does have a place in a diversified portfolio, we also think it is important to understand what is truly involved in owning rental property. If you are considering going this route we encourage you to read on.

So many of our clients have mentioned to us their intention to have rental properties. They look at the current real estate market appreciation and assume that having a rental property will be easy income and the property will appreciate in value. But, here is what you can really expect-

The property may not generate the income you expect
It’s hard to get a return that is truly worth it
For many smaller investors this rental real estate becomes a large percentage of your portfolio, and gives you substantial exposure to one asset class-real estate which has high highs and low lows, and
Real estate is illiquid. You can’t sell it when you want to, unlike stocks or other investments that trade daily.

Learn more about how WealthChoice helps our clients generate the income they need to live the life they want.

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