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S O Y O U ' V ED E C I D E D Y O UW A N T T O B U I L DA R E A L E S T A T EE M P I R E . . .H i s t o r i c a l l y r e a l e s t a t e h a s b e e n o n e o ft h e m o s t d e p e n d a b l e w a y s t o b e c o m ew e a l t h y . A n d m a n y o f t o d a y ' sm i l l i o n a i r e s s a y i t ' s s t i l l a s m a r ti n v e s t m e n t , f o r a v a r i e t y o f r e a s o n s .A c h i e v i n g f i n a n c i a l s e c u r i t y i s o n l yp o s s i b l e i f y o u i n v e s t y o u r m o n e y t o l e ti t g r o w . Y o u r b a s i c s a v i n g s a c c o u n tw o n ’ t a m o u n t t o m u c h , C D s p r o v i d em e d i o c r e r e t u r n s , a n d t h e s t o c k m a r k e ti s r i s k y . S o w h a t ’ s a p e r s o n t o d o ?D i v e r s i f y i n g y o u r i n v e s t m e n t s i s t h e k e ya n d i n v e s t i n g i n r e a l e s t a t e i s a g r e a tw a y t o d o i t . H I , I ' M J A I M E .

“ N I N E T Y P E R C E N TO F A L LM I L L I O N A I R E SB E C O M E S OT H R O U G H O W N I N GR E A L E S T A T E . ”A n d r e w C a r n e g i e

B U Y I N GY O U R F I R S TR E N T A LP R O P E R T Y

B U Y I N G A H O U S E T O R E N TO U T C A N B E A G R E A T W A YT O B R I N G I N M O R EM O N T H L Y C A S H F L O W .W h e n y o u b u y y o u r f i r s t r e n t a l p r o p e r t y , t h e r e i s a l o t t oc o n s i d e r . T h e t y p e o f p r o p e r t y , h o w y o u ’ l l f i n d t e n a n t s ,a n d h o w y o u ’ l l m a n a g e t h e p r o p e r t y a r e j u s t t h e t i p o ft h e i c e b e r g .L e n d e r s l o o k a t r e n t a l p r o p e r t i e s d i f f e r e n t l y t h a n y o u rp r i m a r y r e s i d e n c e . T h e y u s u a l l y w a n t a l a r g e r d o w np a y m e n t a n d c h a r g e h i g h e r i n t e r e s t r a t e s o n t h em o r t g a g e t o m a k e u p f o r t h e r i s k . Y o u ’ r e m o r e l i k e l y t od e f a u l t o n a h o m e y o u d o n ’ t l i v e i n t h a n t h e o n e y o u d o ,e s p e c i a l l y i f y o u h a v e f i n a n c i a l t r o u b l e .B e f o r e y o u b u y a s e c o n d h o m e a s a r e n t a l p r o p e r t y ,m a k e s u r e y o u h a v e t h e m o n e y s a v e d f o r a d o w np a y m e n t , a c o n t i n g e n c y p l a n i f y o u l o s e y o u r t e n a n t sa n d h a v e t o c o v e r t h e m o r t g a g e p a y m e n t a n d o t h e rh o u s i n g c o s t s y o u r s e l f , a n d a p l a n t o m a n a g e t h ep r o p e r t y . W i l l y o u h i r e a p r o p e r t y m a n a g e m e n t c o m p a n yo r d o i t y o u r s e l f ?

You can write off many of theexpenses of maintaining andrepairing the home as businessexpenses.The net cash flow earned from yourrent after expenses can supplementyour retirement income or otherfinancial goals.The rent collected can offset themortgage, repair costs, andexpenses to run the home while youearn the home’s appreciation.You don’t have to pay SocialSecurity taxes on your rentalincome.Real estate isn’t as volatile as thestock market and often reactsopposite to the market, helping youdiversify.You never know what type of tenantyou’re getting, if they’ll bedestructive or if they’ll default ontheir rent.You must follow through on a leaseeven if you need to sell the housefast to liquidate your investment.It’s a lot of work maintaining andrunning a house. Anytimesomething goes wrong, you areresponsible.If you invest long distance, you’llhave to pay a propertymanagement company which canbe expensive.There’s no guarantee yourinvestment will appreciate.P R O S A N D C O N S O FB E C O M I N G A L A N D L O R DP R O S C O N S

C A L C U L A T I N GR E N T A L I N C O M EP U R C H A S E P R I C EN E E D E DI M P R O V E M E N T SF I N A N C I N G &C L O S I N G C O S TT O T A L C O S TM O N T H L Y R E N T M O R T G A G E & F E E SM A N A G E M E N TC O M P A N Y F E E SN E T P R O F I T

“ O W N I N G A H O M EI S A K E Y S T O N E O FW E A L T H … B O T HF I N A N C I A LA F F L U E N C E A N DE M O T I O N A LS E C U R I T Y . ”S u z e O r m a n

7S T E P S T OB E C O M I N G AL A N D L O R D

G E T T O K N O W T H EA R E ADon’t invest in a home without researchingthe area. When you buy a home, you invest inthe neighborhood too. Do your research andfind out the average rent in the area, thenumber of renters in the area, and if the homeyou’re thinking about buying is typical of whatthe local renter wants.Just because you love a home and the areadoesn’t mean renters agree. It doesn’t makesense to invest in a rental home in an areawhere most people buy houses rather thanrent. Work with a local real estate agent tofind out if it’s a good area to invest.O N E

D E C I D E I F Y O UW A N T A F I X E R -U P P E R O R A M O V E -I N R E A D Y H O M EInvesting in a home can look many ways. Youcan buy a home that’s ready for tenants rightaway or buy an undervalued property thatneeds some TLC before you rent it out. Beforeyou look at homes, choose your strategy.If you’re the fixer-upper type, you may savemoney buying an undervalued property, fixingit up yourself, and renting it out. You will notonly earn the rental income, but the homeshould naturally appreciate the homeimprovements. If you’d prefer to buy and rentright away, then buying a move-in-ready homeis a better choice.T W O

K N O W R E N T A LM A R K E T R A T E SYou know what you’d like to charge for rent,but that doesn’t mean that’s what tenants inthe area want to pay. You shouldn’t chargemore than the average rent for the area, sodo your due diligence before buying a home.A licensed real estate agent or appraiser canhelp you learn about the area’s average rents.Work the numbers to determine if it makessense to buy the home knowing how muchrent you can charge. Is it enough to coveryour monthly mortgage payments, 1/12th ofthe real estate taxes and home insurance,plus any costs to maintain or fix the home?Leveraging a house-hacking approach? If yourent out rooms but plan to live in the house,you'll also need to determine if the rentalincome you'll earn is sufficient.If not, you may want to look for a differenthome. Investing in a home that doesn’t allowhigh enough rents leaves you upside downfrom the start.T H R E E

P A Y O F F Y O U RD E B T F I R S TBuying your first rental property is exciting but expensive too. As the landlord, everything falls on yourshoulders. The hot water heater breaks - you’re responsible. The roof has issues - you must fix orreplace it.If you have a lot of consumer debt already, you may not have the extra funds to put aside foremergencies your rental home may have. Focus on paying your consumer debt down (or off) beforeinvesting in a home for more financial security.F O U R

Securing financing for an investment home is alot different than financing for the home youlive in full-time. Lenders view investmentfinancing as riskier, so they usually wantborrowers with excellent credit and stableincome.At least a few months before you think aboutbuying a house to rent out, pull your credit andmake sure there’s nothing to fix. Look for thingslike:Late payments that you can bring currentHigh credit lines you can pay downCollections you can settleMistakes you can dispute with the credit bureauF I X Y O U R C R E D I TF I V E

There's a lot that rests on yourshoulders as the landlord. Knowyour obligations and rights beforebuying your first rental property.Having a lawyer review yourpurchase, the rental agreement,and your strategy can help youdetermine if what you’re doing isworth it, legal, and beneficial foreveryone involved.G E T L E G A L H E L PS I X

F I N D I N G AH E L P F U L A G E N TAn increasing number of real estate agents areassisting investors with finding theirinvestment property. However, it is necessaryto look for a real estate agent specializing inthe rental market because many others stillfocus on buyers and sellers.Real Estate Agents know the local real estatemarket and have their pulse on new listings.However, there are far more listings thanthose that are easily uncovered by Internetsearches. Agents have access to listingsincluded in the multiple listing service (MLS)AND the agents that specialize in incomeproperties also have a list of people looking tosell and unlisted units coming on the market.S E V E N

Historically real estate has been one of the mostdependable ways to become wealthy. And manyof today's millionaires say it's still a smartinvestment, for a variety of reasons.For one thing, investing in real estate gives youa way to diversify your investments. "Don't putall your eggs in one basket" is tried-and-trueadvice for a reason. There are a lot of movingparts to the economy, and there's always thechance that one can crash while the othersthrive. Having exposure in several differentmarkets helps insulate you from risk.R E C A PSecondly, real estate gives you ownership of atangible asset that can appreciate. While I enjoylogging into my portfolio and seeing my stockvalues increase, it's all very abstract. There'ssomething appealing about having a physicalinvestment that you can actually see, visit, andimprove.And since people will always need a place to live,real estate tends to hold its value as long as theproperty is maintained well and the area isappealing.There's also a decent amount of flexibility whenyou own real estate. You can decide whether torent out your property, sell it, subdivide it, rezoneit for a different purpose, and so on. This way, youcan respond to changes in the economy in a waythat still makes your investment useful.All of that said, there's also a big note of cautionhere. Real estate can be a large and expensiveundertaking, and as the housing market crash of2008 illustrated, it's never a sure thing. Especiallywhen it comes to real estate investing forbeginners, it's wise to proceed with caution. Youdon't want to stretch your finances too far beforeyou're ready and end up with debt that youstruggle to repay.

I cannot express how much stress Jaimetook off our plate during the buying andselling process. This is currently an insanemarket and there is no way we would havelanded our dream home and sold ourproperty so quickly without her expertise. Ichose to work with Jaime because I havecome to realize just how important it toselect the right agent who is trulyknowledgeable and experienced in thisindustry, and who has the sales, work ethicand reputation to go along with it. Youragent is representing you through this wholeprocess, so not having these qualities cantruly hurt you with buying and selling (evenin a crazy sellers market!) As a former realtormyself, being on the other side of the table, Iam so thankful I had Jaime to make it all soeasy for us!Jaime came so prepared to our first meeting! Shekept us informed throughout the entire process.She has to be the hardest working agent inAshburn! If you are thinking of buying or selling ,give her a call!C I N D Y H U N T E RK I M M Y H U G G I N SJaime is very professional. She knows her Real Estate,the local markets and has excellent suggestions tomake your home more sellable. Having sold over 15homes, I can say that Jaime is one of the best RealtorsI have worked with. I would recommend her for yourReal Estate needs, but more importantly, I would useher again.P H I L A R G Y R I SN I C E W O R D SF R O M O U R P A S T C L I E N T S

S T A Y I N T O U C HBroker Office:100 S ASHLEY DR TAMPA, FL 33602321.499.9545HOMES@JAIMECRADDOCK.COMS E R V I N G A L L O F F L O R I D A