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While many investors put money into the stock or bond markets, other financially savvy investors choose to invest in residential real estate. The concept of earning passive income through investing in rental properties is not a new one (as any HGTV viewer will attest), but how does one get started? Hint: It may be easier than you might think!

Investing in Rental Properties

Ellen has a keen eye for homes – finding them, improving them, helping buyers buy them and seller sell them. Countless buyers can attest how Ellen helped locate the home of their dreams from a blurry sea of not-quite-right houses. Other homeowners share stories of Ellen’s keen eye for detail, deep insight into neighborhoods and matchless expertise when it comes to understanding the economics of older homes.

Over time Ellen discovered that her sharp eye for detail and overall property expertise translated equally well into the “home as investment” category. As a favor to friends on the lookout for such properties, Ellen began to keep an eye out for homes that might be well-suited as rental properties including multi-unit properties (duplexes and triplexes).

John Smith was one of those close associates that Ellen assisted in helping to build a portfolio of rental properties. John, now the owner of several rental properties – both single and multi-unit – couldn’t be happier with the ongoing outcome. In fact, when asked who should get into homes as rental investments, John replied, “Everyone, everyone! It’s a great business.”

Many first-time landlords start out by purchasing a single-family home, rent it out at a price that covers the mortgage while, over time, the house appreciates in value. As the initial property continues to appreciate it can be held long term – or sold at a profit – those funds reinvested as a down payments on one or more additional rental properties.

A multiunit property – a duplex or triplex – is sometimes an easier starting point than a single-family home. Why? Simply put, in the mathematics of renting out a multi-unit property, you can often make enough in rent to not only pay the mortgage, but also make extra income on top of that.

There is another opportunity with a triplex rental property. Instead of renting out all three units, a potential buyer could live in one unit and rent out the other two units (generally the rent from 1.5 of the units will cover the mortgage – leaving a free unit for living and another half unit’s rent as income!)

Another option that many parents of college age kids use an investment is to purchase a multiunit property in their child’s college town, allowing their college child to live in one unit, while renting out the other one or two units. By graduation time, the family has four years of equity in the college town home – and all units available for rental to incoming college students.

A Triplex Opportunity in Hyde Park

If you’re interested in multi-unit residential homes as an investment opportunity, the good news is Ellen has a unique opportunity currently on the market! John Smith is selling the pictured triplex to a buyer looking for an investment opportunity as he raises funds for further expansion of his investment business. Interested would-be buyers now have a chance to take advantage of this income-producing property – with two of the three units already rented!

The triplex is located in the storied Hyde Park neighborhood of Kansas City. With three separate rental units on three floors, this remodeled triplex features beautiful and spacious living areas – each with its own kitchen. The first two units are 1,800 sq. ft. each, both 3-bedroom and 3-bath. The third top-floor living area is a smaller 1 bedroom, 1 bath unit spanning 900 sq. feet.

Many millennials are postponing homebuying until their early to mid-thirties – and, with the triplex being situated in a much sought-after neighborhood – the individual rental units bring a unique appeal to young professionals looking to escape the hustle and bustle of apartment living.

These attractive units are near popular destinations such as Billie’s Grocery, several fitness centers and the mid-town Costco. Over time, the appeal of this already quite popular part of the city will only increase – as should the real estate value of this charming investment property.

Are you considering making an investment in rental properties? Ellen would love to help support you on your investment quest! Call or text Ellen at 816-489-6950!