Chicago’s real estate market offers many unique opportunities to both buy homes to live in and properties to lease to others. Owning and managing your own rental property can be a great way to invest long term. Here are a few other benefits to building your property portfolio:
The Market is Booming
According the U.S. Census Bureau, over half of the city’s residents rent their homes. In fact, an Urban Institute study predicts that by 2030 the U.S. will see five new renters for every three new homeowners. This unprecedented growth towards renting leads to lower vacancy rates and higher rental pricing. If you’ve toyed with the idea of investing, now is the time. Chicago has seen a boom in rental construction and conversion, making it the ideal time for new investors to connect with a trusted real estate professional and weigh their options. Rentals don’t always have to be multi-unit buildings either; single-family homes appeal to renters looking to get more square footage for their money!
Technology Makes It Easier Than Ever
Advances in technology have made managing an investment property easier than ever. In the past, people would shy away from owning rental properties because of the hassle of leasing and managing their property as a part-time landlord. Online tools and software have simplified the process, automating many of the steps that once caused issues for many investor landlords.
Consider the Write Offs
With tax season at a close, deductions are on everyone’s mind. Most people are unaware of the benefits of owning an investment property can have at tax time. As a landlord, you’ll be able to deduct expenses associated with the upkeep of your property, wages for independent contractors like carpenters or landscapers, utilities and taxes, as well as necessary (and reasonable) repairs to your investment.
Diversify and Appreciate!
Investing in a rental property is the perfect way to diversify your assets. As any investor knows, it is smart to invest in many markets. Real estate is relatively safe market in the long haul. The market is easily researched, allowing you to make an informed decision, and is less volatile than the stock market. While you pay your mortgage each month, your equity in the property increases, as does the potential value of the property. Rental properties are also a great platform to produce income. Considered passive income, rental properties generate money with less work, and is an ideal way to introduce additional revenue post-retirement.
Investing in a rental property is a huge step and comes with both benefits and challenges. Before you start the process, reach out to a trusted real estate broker who can help you navigate the process.