If you’ve already thought seriously about achieving a 7-figure net worth – or perhaps just dreamed about it – you might be wondering how it’s done. The response may amaze you! The fact is that roughly 90% of all millionaires made their fortunes by investing in real estate.
There are few other ways to invest money that offer the kind of stability and growth that real estate can offer, particularly when it comes to single-family rental properties. Why is rental real estate your fastest route to becoming a millionaire? Here are several ways owning Ojai rental properties can make it happen.
Monthly Cash Flow
When done properly, owning rental properties can help you generate a comfortable monthly income. In fact, not only should your rental payments cover the mortgage, insurance, and other expenses, but many investors enjoy positive net cash flows as well. While it is possible to accomplish positive monthly cash flow with just one or two properties, most investors work their way up to a steady income as a result of purchasing multiple properties.
Because your rental payments pay your mortgage, each one can help you to pay down your mortgage and build equity in the property. This equity can then be utilized in lots of ways to help you further increase your wealth-building potential. For instance, equity loans or refinancing a mortgage can help give you cash to invest in another property. You also recognize that equity is in profit when the time comes to sell the property.
Together with building equity, single-family rental homes tend to appreciate in value year over year. This can help increase the amount of equity you have in the home and, by extension, increase your investment activity as well. Although not all real estate markets see gains every year, and some markets will see home prices rise faster than others, if you select your location carefully, you might have seen remarkable upswings in value when the time is right.
Investing in rental real estate is also a fantastic way to get into wealth-building resources that many other investors don’t have. When you have your rental properties leased and expertly managed, you can devote more time to activities that directly contribute to your bottom line. Letting someone else take care of the day-to-day tasks lets you focus on more productive investing activities.
Investing in real estate is also one business that will allow you to leverage other people’s assets to help you grow. Investing partnerships and collaborations are common, particularly with a mentor or trusted business associate. By pooling resources, you can accomplish far more than you could do alone.
Another advantage that’s important not to overlook is a federal tax. Many tax deductions are available to investment property owners, from operating costs to mortgage and property taxes. Many rental real estate investors end up paying far less tax on their monthly income than they would if it was earned another way.
With so much potential, it is easy to understand how investing in rental real estate could be your path to becoming a millionaire! But to get started on the right foot, it’s important to have professional Ojai property managers on your team. At Real Property Management Limitless, we work with rental property investors to assess markets, set accurate rental rates, and even locate off-market properties for sale.
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