For active armed forces service men and women, home ownership can get complicated. A Permanent Change of Station (PCS), for example, can leave you with what you may feel are limited options. What do you do with your property when you move away?
Fortunately, you don’t have to sell. In fact, holding onto your home or investing in others as rental properties can be a great way to boost your monthly income. This leaves you with greater options and revenue for whatever plans you make in the future.
There are five key reasons why investment properties can be the right choice for service members — with excellent property management, of course. We explore these reasons here.
1. Consistent, Passive Revenue
As a service member, it is likely you will receive a monthly housing allowance along with your new station. Having an old home generating an additional monthly rent can allow you to make your mortgage payment while maintaining your professional home. This means that you can freely hold on to a property you've purchased, no matter where you go. This can be immensely beneficial, especially if the property in an area where there is consistent demand, like near a military base.
Additionally, holding onto an investment property can give you certain tax benefits. You can write off associated expenses with your rental as a tax deduction. Meanwhile, the upgrades and service provided by your property manager can improve the value of your property and boost the revenue you generate from your asset on a consistent basis. This means you have a greater chance of building your passive income from anywhere in the world.
Before making the decision to transform your home into a rental, however, consult a financial advisor and a tax professional to see how holding on to your home as a rental property can benefit you.
2. Faster than Selling
Many service members don't have a great amount of time before they have to ship out. This can make selling a home immensely difficult. You may even be pressured into accepting a lower offer because of your time restrictions.
Turning your home into a rental, however, allows you to postpone that step if indeed you choose to sell. This can allow you to make mortgage payments while waiting for a better chance to negotiate offers, coordinate improvements, and market your home for the right buyer.
Especially in markets with low vacancy rates, rental properties can be filled quickly. The right property management company can even work out all the details, marketing, and tenant screening for you so that the process is taken care of while you prepare to depart. Then, you can begin receiving monthly rent checks with little to no effort on your part.
3. Long-term Asset Protection
If you're going anywhere outside an easily drivable distance, maintaining an empty home is not at all advisable. You want to be able to respond to any problems that arise and conduct needed maintenance in a timely manner. However, by working with a property management company to transform your property into an investment, you can keep your asset protected and cultivating value.
Rentals are great because they help you catch any problems with the property so that the property manager can deal with maintenance quickly and efficiently. Vacant properties, on the other hand, can sit for months with issues like leaks or broken pipes going unnoticed. The right property management company will keep your assets protected long-term so that you can eventually come back to a beautiful, functioning home.
4. Time to Think
In the often quick turnaround time that comes with receiving a new station, it can be difficult to work out just what you want your property to do for you long term. Perhaps you never intend on returning to an area. Perhaps you want to keep that option open. Regardless, transforming your home into an investment property will give you the time to work out just what your ultimate goals are.
With time to think, you can build future plans that are easier to execute while generating an additional monthly income stream.
5. Building Lucrative Relationships
Finally, turning your real estate investment into a rental property is a great opportunity to seek out and work with real estate experts two can keep your portfolio growing. Finding the right property management company creates a lucrative relationship. It means passive income for you and a consistent protector and cultivator of your assets’ worth.
The right property management company is not just in the business of skimming a margin of your rental income off the top; they are in the business of increasing the value of your investment. Find a property manager that offers incentives, advice, and expert assistance in finding and managing quality tenants and quality maintenance procedures.
With these five benefits that can come from investment properties, every service member should consider turning their home into a rental rather than outright selling it. No matter your goals, this decision can help give you the options and flexibility for your ideal future.
For more information on real estate investment and property management, contact 208.properties or find us on social media.
