With the market in the Tampa Bay area continuing to heat up, more people than ever have an interest in investing in real estate.
That’s a move that often pays off, especially in the long run. However, there are pros and cons to investing in rental property, especially in a hot market such as the one in Tampa Bay.
Certainly, those who have invested in recent years have done well. Home prices have increased across the area, meaning so have the value of rental properties.
However, it’s best to keep a few things in mind before making the plunge.
Rental Property Investing: Hire a Pro
A good first step is reaching out to someone with a thorough knowledge of the Tampa Bay real estate market. A real estate professional can cut down on the time it takes you to find the right property and also prevent you from making mistakes in choosing a property.
The Big Advantages
No matter where you invest, certain advantages come from buying and leasing out rental property. They include the following.
- Pay Your Mortgage. The overall pro in investing in rental property lies in the fact that you can pay off your mortgage with money received from renters. If you properly set your monthly rental rate, you can cover your monthly mortgage cost and perhaps have some cash left over each month. Once the mortgage is paid, you will make pure profit – minus the cost of maintenance.
- Tax Advantage. Profits made from rental income are not subject to the small business tax.
- Appreciation. Over time, property values tend to grow. As has been seen in the Tampa Bay area, they sometimes can grow very quickly.
One advantage specific to Tampa is the presence of the large MacDill Air Force Base. Military personnel often look to rent rather than buy due to the transient nature of their jobs. If you can find rental property near the base, it could prove a wise investment move.
Because of the beautiful weather and the spectacular beach, maybe condos rise along waterfront areas across Tampa Bay. Some have restrictions on how many units can be used for rental, so you will want to do thorough research on which ones have rental space available. This also can prove a wise investment. They are not making any more beaches or waterfront property like we have in the Tampa Bay area, so demand will never dip very much.
If you decide to invest in a home that can be rented, make sure you check out the area thoroughly. Rates can vary by big amounts depending on location. For examples, South Tampa, where demand is high and available rental properties relatively low, can provide good investment opportunities.
Another factor to consider is risk. If you feel wary of investing too much of your own money into property, then consider a real estate investment group. This allows you to pool money with other investors, distributing the risk. As an example, investors might pool their money to buy individual units within a large building. This also allows you to turn over maintenance work to a company hired by the group.
These represent just a few of the many factors involved with investing in real estate property in Tampa Bay. With property values skyrocketing, it’s best to do thorough research and find a property that will hold its value and increase in the coming years.
With the help of professional, your chances of success should increase.