Are you interested in embarking on one of the best side hustles — something that can steadily increase your net worth?
If you’re having a hard time making ends meet or simply don’t have any money left after paying the bills, you’re not alone. Finding a side hustle, however, could be the perfect remedy for your financial woes.
Buying a rental property won’t come cheap. Even if you purchase something priced below market value, it’ll likely take a tangible financial investment to fix it up so it’s ready for tenants to inhabit. And if you buy something that’s move-in ready, you can expect to pay six figures…or more. But assuming you can buy a rental property, there are many benefits.
Here are four reasons it makes sense to get a rental property — and why hiring a property management firm can make the process easier.
1. Rental Income
One benefit of owning an investment property is you can get rental income every month. Assuming you have good tenants, you’ll have passive income you can use to pay down the mortgage, invest in other endeavors, or do other things. It’s important to remember that you need good tenants for reliable rent. That’s one reason to hire a property management firm to screen would-be tenants rather than go it alone.
You can technically serve as the landlord for your rental property, but getting help can work wonders. Doing things on your own could make the income anything other than “passive.”
However, hiring a property manager that can screen tenants, collect rent, and perform property upkeep can take a load off your shoulders and mind. Hiring a property manager can be a prudent investment that helps you be a better rental property owner.
2. Property Value Appreciation
Another reason it makes sense to invest in a rental property is you can benefit from property value appreciation. According to one source focusing on U.S. house price growth, the average year-over-year growth from March 1992 to December 2024 was 5.4%.
Factors like the type of property you buy, where you buy it, how much you invest into upkeep, and how long you hold onto it will determine how you fare over the long term. But the chance to benefit financially, especially if you monetize down the road, makes buying a rental property a live option.
3. Diversify Investments
Yet another reason to consider buying an investment property is that it can help you diversify your investments. Putting all your proverbial eggs in one nest isn’t a wise strategy. You might want to invest in the stock market, mutual funds, index funds, high-interest savings accounts, bonds, and real estate.
If the goal is to build a strong financial foundation for you and yours, it pays to diversify your investments. That can include all of the above options. When you have your money invested in various asset classes, you won’t have to fret as much when the economy is under pressure.
4. Build Generational Wealth
Do you want to build generational wealth to benefit your children and grandchildren? One way to get to that point is to invest in rental properties. Real estate isn’t the only way to get there, but it can be part of a strategy to accumulate wealth that can be passed down to the next generation.
If you’ve been thinking about buying an investment property, you now know some of the benefits. It’s not for everyone. So, if you’re already struggling with a debt albatross around your neck, now might not be the time to sink yourself deeper into debt. But if you do have your financial ducks in a row and are in an investing state of mind, consider buying a rental property.
