There’s a school of thought that the greater the risk, the greater the reward. Real Estate can be a risky business and is not for the faint of heart. Regardless of the risk, more and more are accepting that risk, and reaping the rewards. While others are more hesitant, even when the option of becoming a landlord is recommended and maybe the only option. Those reluctant people have clearly not consulted the experts at Carod Properties. If they had, then they would have been privy to the wealth of information our Real Estate professionals could provide on the many reasons why becoming an accidental landlord, can be quite a happy accident.
First, what is meant by becoming an accidental landlord? An accidental landlord is someone who has been forced into using a property that they own as an investment property. A few ways this may become a reality, is:
- Inheritance of a property that, for whatever reason, you are either not able to or wishing to live in
- Being unable to sell your property
- Two households becoming one
While you may have never intended to become a landlord, it may be the best option for you and the “unwanted” property. Even those who are experts in the Real Estate game have properties they intended to flip or sale, right away, and either the market or other circumstances prevented it. The difference between them and the reluctant landlord is perspective. Winston Churchill said, “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.” Often, that is what separates success from missed opportunity; the ability to regroup and make the best of the situation.
By becoming a landlord, and not spiraling into utter despair because of an unsellable home, here’s some possible silver linings to those clouds:
- If there is still a mortgage, the rent collected can pay some if not all of the mortgage; this is most beneficial if you carry the property as a rental until it is paid for, making the rent garnered subsequently 100% profit.
- The market may change, making the property worth more when you opt to sell at a later date; again, if this is the case, the mortgage will have been paid down, making more of the sell price go into your pocket rather than paying off the mortgage.
- TAX BREAKS/INCENTIVES: Interest, Depreciation, Repairs, Local/Long Distance Travel Expenses, Home Office Expenses Being your own boss. You may just like being a landlord, and have stumbled onto a business rather than an inconvenience.
The opportunities abound, if you’re willing to do the work involved. Work can be anything from physical labor (renovations and/or ongoing maintenance) to researching the legalities involved. Again, without risk there can be no reward. The reward possible can be great, if only you take the risk and follow through with some work. When you hear Real Estate investor, one day you may not think of the Donald Trumps of the world, but yourself. You never know. And, it was all possible because of an accident!
By: Alicia M. Caldwell, AMC Literary Services
