How to escape the landlord trap and still make money from real estate

Dealing with tenants may sound like a very good way of making an extra income or full-time business, but it is not always like that. Some of the challenges faced may include late-night tenant calls and expensive repairs, challenging renters, and unpredictable real estate markets among others, Tired Of Being A Landlords feel they want out of this landlord biz, this landlord trap that has become a norm for many of us but what if you could avoid dealing with rental property headaches while still participating in the field of real estate investment? Luckily for you, there are other ways of making money from real estate even if you consider yourself done with being a landlord.

1. Why do landlords get burnt?

It is fulfilling to own rental investments since it may become rather tedious. Many property owners reach a breaking point due to many property owners reach a breaking point due to:

• Tenant Troubles: Collecting unpaid rent facing the tenant who trashes the house or when a tenant breaches the lease is always a challenge.

• Constant Maintenance: Managing a rental property can be very time consuming and expensive to the extent that it can discourage many from even considering investment in rental properties.

• Vacancies: Long term vacancy means no cash flow and that you are left to pay bills such as mortgage taxes, and maintenance among others.

• Legal Hassles: Tenants on the other hand have several laws and regulations on their side as well as possibilities to sue a landlord which may prove to be confusing and lengthy for a landlord.

• Lack of Freedom: They get trapped because the management of rentals occupies most of their time and they cannot travel, take time off, or have the financial flexibility they desire.

So, if you are fed up with being what you may call a landlord, then it is good to note that there are other options available. What you ought to understand is that you don’t have to be a resident landlord to derive value from real estate investment out of your investment.

2. The Real Estate Trap: The following are some reasons why landlords feel trapped in their decision to lease their apartments:

One of its feasibility discouraging factors is that many landlords often feel stuck because departing from their property or leaving the market often feels like abandoning a lucrative business. However, this means usually staying in a draining landlord role out of fear, which results in decision-making that causes burnout. The challenge lies in being able to remain involved in real estate investment while at the same time freeing yourself of the tiresome and demanding duties of a landlord.

Fortunately, it is possible to do this while avoiding the landlord trap and still be making money, thanks to a change of tack. Below are various techniques of sustaining profits in real estate other than the ordinary barriers of a landlord.

3. The property should be sold and the money used to fund more deals in real estate syndications.

If you are sick and tired of being a landlord but not ready to completely get out of the real estate business there is a wonderful solution sell your rental properties and become an investor in real estate syndications a real estate syndication is defined as a type of agreement in which multiple investors combine their capital to invest in big properties such as apartment, commercial, or development projects.

Through syndications, one can invest with little effort as the professionals are the ones who handle the properties. The main benefits include:

• Passive Income: You still enjoy your share of returns in terms of earnings from rental or from property value appreciation, yet you have nothing to do with tenants, mechanisms breakdown, or property management.

Although investing in real estate still has its advantages, you can let go of your responsibilities of being a landlord by investing in syndications.

4. Let the property management company be hired.

If you are still not willing to sell your properties but fed up with Being A Landlord, you may hire a property management firm. Such firms are involved in the sourcing of tenants and management of rentals, management of the properties, and management of any matter inclusive of tenant complaints and repairs among others.

The benefits of hiring a property manager include:

• Time Freedom: You no longer have to be involved in repairs, or other problems associated with tenets, which saves time that can otherwise be used in other activities.

• Professional Expertise: Property managers have adequate knowledge and skills in legal matters as well as the handling of other issues to do with the tenants thereby minimizing losses through lawsuits or tenant turnover.

5. When you decide to do this you should sell your rental property and reinvest the money into REITs.

A further approach for those who are fed up with being landlords is disposing of their rental houses and investing in REITs or real estate investment trusts, REITs refer to companies that own or manage properties, and purchase or invest in income-generating properties they collect money from several investors at one time to purchase income generating properties such as business premises, shopping malls, or maybe apartments.

• Liquidity:  Interestingly, REITs can be bought like stocks and can also be sold making it easier for you to manage your investments.

• Dividend Income: The majority of new REITs issue continuous dividend distribution to the investors as a way of generating returns without overt involvement with properties.

6. Think about Short Term Accommodation with Management Assistance

For those who prefer to be landlords and continue maintaining rental properties but are simply sick and tired of being landlords in this classic sense, transitioning to short-term lets, including those like Airbnb brings in new elements of novelty. Flats finally for the short term are more lucrative than the long-term lease since nightly per-property rates surpass annual ones.

But, as you will find out managing a short term rental business can also be quite tiring if you would like to enjoy the advantages of having short term rentals without having to deal with the issues mentioned above then using the services of a management company could just be the solution that you are looking for they can take care of the can take care of:

 

• Marketing your property

 

• Managing guest communications

 

• Sanitizing the space in between guest visits

 

• Pricing optimization

It can be done by choosing short-term renting as well as employing management services to make the process as passive as possible and bring more money into your pocket.

Conclusion

But if you are fed up with being a landlord, you should understand that you do not necessarily have to depart from real estate. At any rate, there are numerous approaches that you can consider, to avoid the Landlord trap and continue making money from real estate investments including investing in syndications and hiring a property management company among others. So, with the help of knowing the right course for you, you can still reap the gains of this investment without burdening yourself every day with maintenance chores.

Few individuals are even conscious of the fact that they have an alternative to not listing the house by themselves or not hiring a real estate company. The other somewhat unknown option is to sell fast to a cash home-buying company such as ourselves. This option you get to save thousands of dollars which would have been paid to the agents in commissions and closing costs for a buyer who needs a bank loan to finance the purchase of a house.

FAQs

How do I know when I am ready to say that am no more a landlord?

Being stressed always, having many complaints from the tenants, and experiencing much pressure with property management matters can be signs that one is done with the business of being a landlord.

Is it still possible to profit from real estate even if I do not own any single rental property?

There is, however, a way you can generate income from real estate without owning properties, dealing with tenants, or engaging in any construction – through investing in REITs, in real estate syndications, or using seller financing.

This has brought the following questions: What are the cost implications of engaging a property management firm?

This cost ranges from 8-12% of the fair market rent every month and other charges such as leasing fees, and repair fee among others.

The good thing about this type of investment is that a tenant typically stays for a short time and the property can be sold quickly.

It may take a while to sell a property but opting for cash buyers or coming up with a seller financing option may take a shorter duration.

To some extent, can seller financing help us get rid of the landlord?

Yes, as the name implies, selling the property through the approach’seller financing’ enable a landlord to sell the property and have another form of monthly revenue from the buyers.