Are you a part-time landlord looking to build your investment portfolio? Read this article to understand what to consider before becoming a full-time landlord.
Many new landlords start by investing in one rental unit, which allows them to earn a passive income as a part-time landlord. However, once landlords get a taste of how lucrative investing in real estate can be, they want to expand their investment portfolio!
Property investors seeking to expand their portfolio and increase their income ultimately need to transition from part-time to full-time landlords.
While the idea of becoming a full-time landlord can seem daunting, this venture is actually one of the best ways to grow your wealth as a rental property investor. In order for your investments to thrive, it’s crucial to know how to transition from being a part-time landlord to a full-time rental property owner.
Some rental property owners are reluctant to make real estate their main source of income. To become a successful investment, a rental property requires your full dedication. As an investment property owner, you’ll only be able to realize your highest income potential in the rental business if you become a full-time landlord.
Here are some of the benefits of becoming a full-time rental property owner:
Most regular jobs require you to be at the workplace during your working hours. Often, you can’t do things unrelated to your job while you’re at work. If you’re a parent, you’ll likely miss a lot of school activities because you have work.
Fortunately, investing in rental property gives you lifestyle flexibility you wouldn't have as an employee. While being a landlord still comes with professional responsibilities, you have the luxury of setting your own schedule.
Owning a rental property is a great way to earn a better income, one that’s better than working an office job. Based on the quality and value of your rental unit, you have control over how much ROI or return on investment you can earn. You can charge tenants a higher rent if you think your property is worth it, provided any rent increase complies with landlord-tenant law.
If you become a full-time landlord, you can also focus more on your rental business and expand your investment portfolio. You can invest in more properties and provide better services to your tenants, which will translate into more profits.
Being a landlord also comes with tax advantages. Since owning rental property is similar to running a business, you’ll earn tax deductions. Take advantage of property-related deductions and depreciation as well as other expenses related to setting up your home office.
Once you’re ready to quit your job and transition to being a full-time landlord, make sure you prepare well. Fortunately, there are things that can help make your transition as smooth as possible. Make sure to keep the following tips in mind:
While being a landlord can be financially rewarding, it’s generally a long-term investment—this means you’ll have to wait before you can realize your returns. Before you quit your job, make sure you’ve saved enough money to keep you going for at least six months to one year while you grow your investment.
You need to figure out your cost of living and how much your living expenses are per month. In general, you’ll need around six to 12 months’ worth of expenses that will serve as a financial buffer in case your rental business doesn’t take off as soon as you planned. To make a comfortable shift, you’ll need money saved in an easily accessible account.
Build your portfolio gradually to see if being a landlord is indeed the right career path for you. Start with one or two rental units, and operate your rental business while you still have your full-time job. This way you can tell if the business is earning enough income to cover your personal expenses while you transition into being a full-time landlord.
When you’re sure that being a landlord is a viable option, you can start adding to your portfolio by buying multiple properties. Then you can transition into being a full-time rental property owner by quitting your job and focusing on your rental business.
The real estate industry is big. An investor has a better chance of being successful with a good network of professionals. Surround yourself with successful real estate professionals and find a good mentor who can help you with your venture.
It’s best to network with people more experienced than you so you can learn from their success.
Many landlords confuse investing with managing. They think that if they become a full-time real estate investor, they need to focus on managing the operation of their rental properties. This isn’t entirely true.
To become successful in real estate, seasoned investors entrust the operation side of the business to professional property managers. With the help of an experienced and qualified property management team like Innovative Property Solutions, you can focus on growing your investment portfolio and building your wealth.
Although becoming a full-time landlord can be intimidating, it can also be extremely rewarding. When you’re ready to make the transition from being a part-time landlord to being a full-time landlord, consider partnering with the trusted property managers at Innovative Property Solutions.
We’ll make sure to manage your property and take care of your business on your behalf, so you can focus on your investment portfolio and build your wealth. Contact us at (904) 321-9020 and request a rental analysis today!
Innovative Property Solutions
8833 Perimeter Park Blvd Suite 301, Jacksonville, FL 32216(904) 321-9020
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