House Flipping Vs. Rental Properties – Which Option Is Better?
Are you thinking about getting started with house flipping but you’re not sure if you should do that or invest your money in rental properties? If so, you come to the right place.
This article will break down house flipping versus real estate investing and provide you with feedback for which option is better in 2020-2021.
Over the last 10 years, house flipping has been glamorously portrayed in the media, especially on TV shows like Flip or Flop, where investors are shown purchasing houses for low prices, renovating them, and selling those properties for huge profits.
As with anything in life, it’s important to look at the pros and cons of house flipping before you get started with this type of real estate investing.
Pros – With house flipping, if possible, to make a quick return on investment because, depending on the condition of the house that you purchase, you could make her money back within 6 months or less.
As with any form of real estate investing, you must do your due diligence before purchasing a property that you intend to renovate and flip for profit. Taking the time to thoroughly investigate a property will save you the time, money, and hassle of investing in a property that will only end up becoming a major headache for you.
Pros – Besides offering you the opportunity to earn fast cash from your investment, house flipping also offers you the added benefit of being able to have lower long-term costs because, when you flip houses you don’t have to hire a property management company, pay a mortgage, or have other long-term expenses that come from owning real estate.
Cons – There’s no denying that the income that can be earned from house flipping is highly beneficial but, during the years where the market has been down, house flippers have struggled financially because, they put their money into the houses that they purchased and found that they had to wait months for their properties to sell.
This happened back in 2008 following the last financial crisis when many investors purchased homes that they wanted to flip before the financial crisis and found themselves having to hold on to those properties for a lot longer than expected.
Make no mistake about it, as a long-time property management company, we strongly suggest that every investor have rental properties in their investment portfolios.
Even though rental properties are awesome, they do have some downsides that we need to talk about including the following
Cons – Let’s face it, vacancies are always going to occur, but the good news is that with the use of technology it’s easy to rent a property quickly so even though you may have a temporary vacancy, as long as you rent that vacant unit out as soon as it becomes available, you shouldn’t have a vacancy for a long period of time.
Cons – Unless you intend on hiring a property management company, owning a rental property is a lot of work. There’s no way around it because, as long as you’re focusing on DIY Property Management, you’re going to have to market your property for rent on the internet, collect the rent, provide customer service, maintenance, and more.
When you hire a property management company, you obviously won’t have to do everything yourself because all of the services that we just mentioned will be taken care of for you by a professional property management team.
Overall, your decision to get started with flipping houses versus owning rental properties is up to you but, when you consider the long-term benefits that come from owning rental properties, the decision should be an easy one to make, especially if your ultimate goal is to generate passive income and long-term cash flow from those rental properties that will last for years to come.
Contact Rent Portland Homes – Professionals
At Rent Portland Homes – Professionals, we specialize in providing our clients with boutique-style Property Management Services. This means that we treat every client, like they are our only client.
Our commitment to service has enabled us to build one of the top Property Management brands in the state of Oregon and companies from all across the United States choose us to manage their rental properties in the Portland area because they value our commitment to excellent service and support
For more information about the property management services that we can offer you, or speak with us about house flipping versus investing in rental properties, contact us today by clicking here.