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Top 5 Myths About Owning a Rental Property

As an agent who deals with a lot of investment properties, I often come across many commonly misunderstood myths about owning rental properties. Having sold hundreds of rentals units, and owning several rental properties myself, I wanted to set forth the truths behind some of these myths. Following are some of the top myths I see about owning rental properties.

Myth #1: I can’t afford it!

Truth: Banks will lend to you with as low as 20% down on a rental property. You can get funds from available cash, retirement accounts or a HELOC on your primary (or other) property. On a $250,000 condo, that’s as low as a $50,000 down payment.

Myth #2: It’s hard to manage properties!

Truth: Property management is simple to learn and do! Have you ever rented an apartment? That’s all you need to do. I have all the forms you need, tips on running your rentals, and vendors who can handle emergency calls and repairs.

Myth #3: I can buy something for less in Florida (Texas, Arizona, Nevada, etc.)!

Truth: You can, but they will not generate the same long term returns that something in the metro LA area will. Also, we have almost no vacancy here – whereas other states sometimes have 30% vacancy.

Myth #4: It’s hard to find a tenant!

Truth: Go and put up a sample ad on Craigslist – you’ll get a ton of responses. Los Angeles has a housing shortage – there are more tenants than properties.

Myth #5: HOAs are bad!

Truth: HOAs minimize your risk and provide some management for you! They also provide insurance, repairs, and amenities that are desirable to tenants. You can read more about the truth about HOAs.

For more questions about rental properties contact me at (310) 482-0173 or send me an email.

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