Would it be a good investment if i bought 2 homes and rented them both out?

Question

i live in the bay area and i was looking at places like antioch for example and prices have dropped so low that im thinking about buying as investment. My goal is to buy investment property this year and get cash flow but this is my first time as a buyer so im kind of afraid because i know it isnt a gaurnatee to get tenants

Answer 1

Tenants aren't always guaranteed. A big misconception about rental properties is that you get automatic cash flow. Unless you paid cash for the home, or put a HUGE chunk down, the money you charge will mostly go towards the mortgage with little left over. The real money made from rental properties comes years down the road, when you have had renters paying off your mortgage and then you sell the place and keep all the cash.

I wouldn't, as a buyer, have your first time buy be rental properties.  

Answer 2

This is a good idea, but you are never guaranteed to get tenants.

Check the local rates for rent and apply it to how much you will make vs. how much you will pay for mortgage.

Always think what would be the lowest price you would rent your space for and then see if it would pay off.

Answer 3

1. Location, location, location.

2. If you are doubtful... see number one.

3.  Make sure this is the right business for you. Being a landlord is not for everyone.

4. Learn as much as you can before risking your money. There are a ton of real estate investment forums online where you can gain knowledge about the different aspects of real estate investing for free.

Answer 4

wow. im in the same situation. im looking to buy a house in brentwood and rent it out and use that to pay my mortgage. what a coincidence

Answer 5

It's a lot of hassle!  People will tear up your house and often the damages they do will eat up your revenue.  Some people don't pay, are deadbeats, and will leave you hanging.  You might have to evict them!  if your going to buy some properties to rent, do it in a GOOD neighborhood.  Don't ever be a slum Lord.  Make it in a more upscale or upper middle class area.  Do credit histories on the people and make them do a complete application.  Check out their references and require a lease contract with notarized signatures.  Get first months rent IN ADVANCE and full security deposit.  NO EXCEPTIONS and no hard luck stories.  Do not rent to people that don't have a good employment history or are not currently working.  DO NOT allow pets or your home will damaged or destroyed.  if you do allow a pet, than require an additional deposit in the amount of the first months rent and do regular inspections of the house.  Anything doing is worth doing right especially in the case of rentals.  If you stick with credible upscale people who have a good history and financial means to pay, than you might have a good business.  Do it wrong, and you may end up losing your butt and end up wanting to pull your hair out.

Remember if you buy properties and this dont work out, and end up wanting to resell, wirth the housing market you might have a hard time (especially if things continue to get worse).