When you purchase a rental property, it’s important to account for unexpected expenses. How much should you set aside for repairs? That’s the first question I’m tackling on today’s Q&A episode!
On today’s show, I’m taking three listener questions on setting aside funds for repairs, how to decide if you should pursue private money, and ways to get started in real estate if you don’t have a down payment. Tune into this episode of Investing in Real Estate to hear my input on your investing questions!
On this episode you’ll learn:
- How to account for expenses and repairs on a rental property.
- How to decide if you should use private money.
- Methods for buying a rental property without a down payment.
How to Account for Expenses and Repairs on a Rental Property
When it comes to buying a rental property, the numbers matter. The best way to ensure that your rental property won’t drain your wallet is to run a solid ROI formula before you purchase. Personally, I like to set aside 40% of the annual rent to account for maintenance and repairs. However, this amount can vary depending on the quality of your property. For example, new construction rental properties typically need fewer repairs since all of the main components are brand new. I recommend setting up a high yield savings account like Outlet so that you have funds available when you need them.
How to Decide If You Should Use Private Money
If you’re planning to work with a full-service company like Morris Invest, we can provide you with financing options that work for your unique situation. We work with a variety of conventional lenders, and can also offer non-recourse financing. Because interest rates are so low right now, I’d consider these options before pursuing private money. Book a call to speak with our experts about your options.
Methods for Buying a Rental Property without a Down Payment
There are many creative ways to buy real estate if you don’t have the money for a down payment. Most millionaire real estate investors got started using other people’s money! The options are endless, but I’d recommend looking into business credit cards and driving for dollars.
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DISCLAIMER: I am not a financial adviser. I only express my opinion based on my experience. Your experience may be different. These videos are for educational and inspirational purposes only. Investing of any kind involves risk. While it is possible to minimize risk, your investments are solely your responsibility. It is imperative that you conduct your own research. There is no guarantee of gains or losses on investments.
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