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This Is How Much Profit on Your Rental Properties

The US has over 43.6 million households that rent. If you’re considering becoming a landlord, then you may be wondering how much you can profit on rental property investments.

Unfortunately, there’s no one answer for the average amount. This is because the amount of money you can make on a rental property depends on a variety of factors, such as where the property is located, how much you’ve invested in it, and how long it’s been on the market.

That said, there are a few basic trends that can give you a good idea of what to expect. Read on to learn more about rental property investments.

Profit From Rental Property Investments: The Main Categories

In most cases, rental property profit falls into one of three categories:

1. Passive income – This is money that comes in on a regular basis, without you having to do much work. For example, if your tenant pays their rent on time every month, you can consider that passive income.

2. Active income – This is money that you make through your own efforts, such as by fixing up and selling a rental property.

3. Portfolio income – This is a combination of passive and active income. It’s what you can expect to make if you have several rental properties that generate a steady flow of cash.

When your rental properties are growing, or you’re new to property investments, you may need a little help. In that case, property management is the best solution. Check out this official website to discover more about it.

Rental Property Investment: Determining Factors

There are a number of factors that can affect rental property profits. Some of the most important ones are as follows:

The Location of the Property

Rental property profit is heavily affected by the location. If a property is located in a desirable area, it will likely have higher rent and be more profitable. On the other hand, if a property is located in an undesirable area, it may have lower rent and be less profitable.

You should do lots of research on the area before making a rental property investment.

The Size of the Property

The size of the property can also affect rental profits. Generally speaking, the larger the property, the higher the rent. So, a large property in an upscale area is more profitable than a small property in an undesirable location.

The Condition of the Property

The condition of the property is also important. The profit margin on rental property is higher on a well-kept property that’s in good condition. And again, the rent can be more expensive on a nice building than rent on a rundown property.

Real Estate Investing: Making a Profit on Rental Property

Thank you for reading! We hope this article was helpful in outlining the many factors that go into how much profit on rental property investments that a landlord can expect. Keep in mind, there is no one right answer to this question—every person’s situation is different.

Please feel free to browse our website to find more helpful information on a variety of topics. Thanks again for stopping by our site!

 

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About the Author

Kaya Wittenburg

Blog Author and CEO

Kaya Wittenburg is the Founder and CEO of Sky Five Properties. Since the age of 10, real estate has been deeply ingrained into his thoughts. With world-class negotiation and deal-making skills, he brings a highly impactful presence into every transaction that he touches.

He is here to help you use real estate as a vehicle to develop your own personal empire and feel deeply satisfied along the way. If you have an interest in buying, selling or renting property in South Florida, contact Kaya today.

   
Feel free to call me at: (305) 357-0635
or contact via email: info@skyfiveproperties.com