J Money of BudgetsAreSexy.com discusses the pros and cons of being a landlord. Should you become a real estate mogul?
J Money has been a personal finance blogger since 2008. His first site was Budgets are Sexy and he recently started Rockstar Finance. J Money found his way to PF blogging like a lot of other bloggers, from making a huge financial misstep. He bought a too large house in 2007 in the DC area.
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Finding himself underwater and unable to sell the house, J became an accidental landlord when he decided to rent out the home he owned and rent a place himself. But he was leaving the DC area so he had to figure out a way to make his situation work.
J decided to hire a property management company to handle the day to day. The company does everything from finding a tenant to taking care of repairs. There is a lot of up front cost and stress but once a good tenant is settled in, the process is pretty smooth.
If you are planning to remain geographically close to your rental property you may be able to manage the property yourself but if you are leaving the area, a property manager is going to be a necessity.
Knowing your renter personally is a big bonus. You’ll trust that person more and have a closer relationship which will decrease the odds of the renter trashing the place. A renter who is a member of the military can also be a good bet as their personal and financial behavior has a direct effect on their career.
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Just like running any business, renting your home will have hidden expenses. If it takes a month or two to find a tenant, you will be paying the management company as well as the mortgage payments until the place in rented. But the peace of mind that comes with paying someone else be the first contact when the air conditioner brakes will be worth it for most people.
Budgets Are Sexy: J Money’s Budgeting Blog
Rockstar Finance: J’s collection of money articles.
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