Recent Posts
Featured Posts

6 Ways to Overcome Objections to Owning Single-Family Home Rental Properties, by Harold Willig

Your friends, family, and business associates may wonder why you have invested in single-family homes, or are considering doing so. And their wonder may often be tinged with disdain, apprehension, or lack of knowledge.

Here are six common objections to investing in rental properties – often made by those who have never invested in homes – and how to overcome them.

1. “You’ll Hate Being a Landlord”

Your pals may say that tenants are like nightmares. They don't pay rent on time, they complain incessantly, and they fight with the neighbors. Solution: pick the right tenants and/or the right property management firm. The most important reason why people fail at real estate investing is often inexperienced property management.

2. “You Won’t Cash Flow”

Your friends may say that you’ll lose money each month due to vacancies, maintenance, interest, and taxes. Solution: Build in the expense of maintenance, vacancies, and so on before you buy. The positive cash flow months may then make up for the less positive months. Diversification also helps cash flow. The more rentals you have, the less likely one underperforming asset may harm your overall portfolio.

3. “You Can Only Make Money in Multi-Family Homes”

Those closest to you may also say that apartment homes are the place to be - not single-family homes. Both single and multi-family homes have advantages and disadvantages as investments, and which venue you choose may depend on your objectives, temperament, financing options, location, and other issues. But an either/or blanket statement may miss the mark.

4. “You’ll Lose Your Shirt When Home Prices Drop”

If sales comp prices have decreased in the neighborhood where your investment homes are, well, you don't have to sell then, particularly if you are a long-term investor. If you have invested in properties that continue to generate positive cash flow, you should continue to make money if prices go down.

5. “You Can’t Make Money Here”

Location of course is key. If you live in high-priced cities like New York City, San Francisco, and Los Angeles, you may not be able to find neighborhoods and homes with cash flow potential. Solution: invest somewhere else. For SpringView, that has currently meant in and around the Chicago metropolitan area.

6. “You Can Make More Money in the Stock Market, Bond Market, or Mutual Funds”

Perhaps some investors can, but seasoned stock investors are the ones who may often say this. If your friends have compared the returns of the Stand & Poor’s 500 Index with a housing price index, such as the S&P Case-Shiller Home Price Index, the returns may not be comparable. Why? Housing indexes generally measure the before and after price of properties at a given point in time, and do not account for the potential income generated by rental properties.

For more information on why your should consider investing in a professionally managed portfolio of single-family homes, please contact Harold Willig at 917-209-4452 or harold.willig@springviewinvestments.com

Follow Us
Search By Tags
Archive
  • Facebook Basic Square
  • Twitter Basic Square
  • LinkedIn Social Icon

@ 2017 SpringView Investments, LLC    All Rights Reserved.    Brooklyn, NY 11210      Legal     Sitemap     Site by Serebrin Partners 

For more information:

917-209-4452