Introduction
Buying your first rental property can be a game-changer. Passive income, property appreciation, and tax benefits—what’s not to like? But success depends on choosing the right property and managing it well.
Step 1: Understand the Numbers
Look at:
- Cap Rate: Net operating income ÷ property price
- Cash-on-Cash Return: Annual cash flow ÷ initial investment
- Appreciation potential in the local market
Use a deal analyzer before buying.
Step 2: Pick the Right Property Type
- Single-family home = easier to finance/manage
- Duplex = live in one unit, rent the other
- Condo = less maintenance, but HOA fees
Step 3: Know Your Ideal Tenant
Who do you want to rent to?
- Young professionals?
- Families?
- College students?
This affects your location, rent range, and renovation choices.
Step 4: Screen Tenants Thoroughly
- Credit check
- Background check
- Verify employment/income
- Rental history
Bad tenants can kill your cash flow fast.
Step 5: Decide on Self-Management vs Property Manager
DIY saves money but takes time.
A good property manager typically charges 8–10% of monthly rent but handles everything from maintenance to evictions.
Final Thoughts
Owning rental property isn’t 100% passive—but it can be 100% worth it with the right plan. If you’re thinking about becoming a landlord, I can help you analyze deals and find the right market.
📈 Want a free rental property calculator? [Download here]