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The Best Ways to Make Money in Rental Real Estate – Fast!

Miniature Houses on a Piles of CoinsFor anyone who’s been investing in Albuquerque rental properties, it’s common knowledge that making a profit through your investments is what leads to long-term success. According to recent data, individual real estate investors own almost 75% of all rental properties in the U.S. And, with home values on the rise in markets nationwide (more than 19% since 2020!), buying real estate is both a popular and a potentially profitable way to build wealth.

It’s easy to believe the lie that investing in rental properties will easily generate good money. Just like any other investment, there are other factors involved. Nevertheless, with the proper set of information and skills, anyone can easily learn how to make money in rental real estate quickly.

Quick but Risky

While most profitable approaches to real estate investing require time, there are a few ways to earn a couple of bucks with real estate. What, you may ask? House flipping. Just as you’d expect, it does come with pros and cons. To illustrate, house flipping makes it possible for you to turn a profit in a year.

The process of locating, buying, renovating, and then re-selling just one property can be very lengthy at times. Along the way, you could encounter unforeseen expenses like repairs; or, maybe even a sudden downturn in the market. To create a steady income stream, it is important for you to be looking for investment properties, and to have a couple of renovation projects underway. This spells both stress and time.

Profitable (Maybe) and Volatile

Something else you can do to make fast money by investing in real estate is to buy property as a vacation or short-term rental. Some investors like the idea of charging far more than long-term rental rates for a property, especially if it is near popular vacation areas or destination spots. Owning these rentals, though, means that the owners are at the mercy of a volatile market. Your property could end up not being profitable if tourism declines, or even if a couple of events don’t push through.

With short-term and vacation rentals, the key to steady income is to have multiple tenants. The tenant screening process, though, is such a pain to handle. It’s also inevitable to experience some noticeable wear and tear, given the number of people going in and out of the property every week. Wear and tear equal maintenance and repairs; meaning, more costs on your end. This will inevitably lead to loss, especially when the competition is high and the hotels are cheap. This will make it difficult to rent out your property.

Profitable and Stable

If you want a less stressful option, you can go down the buy-and-hold approach to real estate. It’s just as profitable as these riskier methods, too! There’s a good reason as to why most investors almost always go for long-term rentals. Long-term rentals, such as single-family rental homes, require far less attention on a day-to-day basis. These rentals usually have tenants who stay for a long time, especially because the number of renters nowadays has gone up. What does this imply? Well, you won’t have to work hard for the marketing and tenant screening all too much!

What is more, tenants in long-term rentals tend to take better care of the property and can be relied on to help with regular maintenance tasks. This does not apply, however, to vacation or short-term rentals. With long-term rental properties, rental income is far more regular and steady, and over time, property appreciation can make owning long-term rentals one of the best ways to build real wealth.

If making money through investing in rental real estate is your thing, then you’re in the right place. If so, you are who we are looking for. Our Albuquerque property managers work with investors like you to help find, assess, and manage quality single-family rental properties. Contact us online to learn more!

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