I understand how hard it is to try something new. Its even harder when your time or your money is at stake.
How can you be sure that things will work out? Let’s alleviate some of those fears by talking about two problem areas that most real estate beginners tend to worry about: property and tenants.
Fear #1: You’ll buy a money-pit
This is a big one for us. People usually think that they have to start with a small, single-family home for their first rental. That can be a huge expense, especially if the home needs work right off the bat (it will). When you have one unit, and it’s under construction you can’t rent it out, and have zero income from the property.
Fear #2: Dealing with bad tenants.
Good tenants are ones that pay on time. But sometimes life happens and you have renters that don’t (or can’t) pay their rent on time. This is a big problem if you’re relying on one tenant to cover the whole mortgage.
What we love about starting with small apartments is that you mitigate your risk in both of these areas. If one or two units need work, you can rent out the others and generate income right away. If you have a couple of bad tenants, you still have other good tenants who pay on time. So instead of risking 100% of your possible revenue when things don’t go exactly as planned, you’re risking a fraction of that.
Small apartments are a great place to start for people new to real estate, but we don’t want you to go in unprepared, that’s why we created Small Apartment School to give you the knowledge and tools you need to be successful.