Should You Buy a Property for Rental Income?
Rental property can generate income, but the decision requires more than comparing rent with the purchase price.
Estimate Real Rent
Research comparable rents and distinguish asking rents from actual achievable rents. Consider furnishing, amenities, parking and location.
Calculate Net Yield
Subtract maintenance, vacancy, taxes, repairs, property management and financing costs from gross rent.
Assess Tenant Demand
A property near employment, education, transport and daily infrastructure may have a stronger tenant pool, but demand should be researched rather than assumed.
Consider the Exit
Think about resale demand, transaction costs and the expected holding period. An investment needs both an income thesis and an exit thesis.
Know the Work Involved
Landlord responsibilities can include maintenance, tenant communication, repairs and compliance. Decide whether you will manage these directly or outsource them.
