Property has long been championed as one of the best types of investment. However, the problem with most property investments is the fact that they require a large financial outlay. This is something a lot of people cannot afford, especially with mortgages being more difficult to come by nowadays. Nevertheless, there is another way you can make a significant profit from rental properties without making a massive monetary investment. This is the rent to rent strategy. Keep on reading to discover everything you need to know about it.
So, what is rent to rent and how does it work? With this strategy, you rent a property from a landlord on a single let basis. However, instead of living in the property, you will turn as many rooms as possible into bedrooms, and you will sublet them individually. Of course, you need to seek permission from the landlord before doing this.
Through multi-letting, you will receive numerous rents each month. You will then subtract the rental amount you need to pay the landlord, as well as any other costs, such as insurance and utility bills. You will then bank the difference, with a lot of people making around $1,000 per month per property.
You are probably thinking; “this sounds great, but how am I supposed to convince the landlord that this is a good idea?” This is an understandable concern, after all, if it is that easy, why doesn’t the landlord just do it, right? Well, not everyone wants this hassle, and you have to consider the fact that a lot of people have fallen into the role of being a landlord accidentally, as they have been left unable to sell their property after the economic downtown. This is where you come in, offering them a guaranteed rent every month while taking the hassle of management and small maintenance off their hands. It is an offer they cannot refuse.
Anyone can capitalise on this strategy, and it is one hundred per cent legal, however, you are advised to seek expert assistance. You can’t afford to go into this with your eyes closed. After all, while you may not need a huge investment, you will still need a few grand to rent the property and convert the rooms, and you will need a property manager too, and it is unlikely this is a sum of money you can afford to waste.
Plus, there is a lot that needs to be considered when seeking rental properties for the purpose of subletting, such as insurance, contracts, property management and such like. An expert can advise you on the best way to handle this situation.