Rental properties as a source of passive income for life-long benefits

Passive income is income you get without actively having to work for it. It frees up your time and you no longer have to worry about actively working to generate money every month. You work one time and create a product or service and set up the system once, and it generates money for you. While no income is one hundred percent passive, you at least have to maintain it, but that has no real work involved. Passive income has become a buzz word since the last decade and many people are looking to create avenues to generate passive income. For example a writer can write a book and publish it. He will then receive a royalty on the book sales for life. Passive income is not just applicable to the arts and entertainment industry. This pattern can be executed in various fields including real estate.

We know that the cost for properties in metropolitan cities is extremely high and is only moving upwards. Not just our metro cities, even towns are now catching up and due to social and economic development the property prices are going high. Hence a lot of people are now more than ever looking for rented apartments.  If you have the money to invest in real estate, now is a good time. The return on investment rate in real estate is very high and that’s why real estate is a very lucrative investment. You can give your flats for rent in Ranchi or in Delhi; the investment is almost guaranteed to be a positive one due to the demand for housing in India right now.  Rental real estate investment is a great way to build wealth. Let us look at some of the characteristics and benefits of rental property investment.

Steady cash flow- Compared to stock market and other investment options, real estate investment is the best as it provides a steady cash flow. The more the properties you own the higher your cash flow. If you give your flats on rent you are guaranteed to earn a regular monthly income.  If one has a couple of property one can retire like a king peacefully without ever having to worry about income for the rest of his life.

Purchase Cheaper – Purchasing flats for rental investment has another benefit. That is one can get a lot of flats for below the market value. Many a time sellers want money urgently at a short notice and hence want to sell their house immediately for a lesser amount. If you are a serial property buyer, you can take advantage of this opportunity and get flats for below market values. This happens more times than one can imagine.

Return on Investment- If you plan to sell you property after a couple of years the return on investment in most cases is guaranteed to be high. The property prices always keep increasing and if you sell your property after some years you can earn much more than what your pain for. Sometimes it is even double, triple and more. If one is to compare the selling process and cost to stalk market, it is more expensive to sell a property. But the huge profits one makes covers up this cost very easily.

Avoid property hassles– If you have more than one property, you can easily keep a manager to maintain and take care of your properties. Property maintenance, tenant hassles, rent collection etc – all these can be carried out by the manager. This will keep your mind away from all the hassles.

Renting your properties can be a very beneficial passive income source. Once should definitely consider this investment option to accumulate large wealth.