Investing in rental property for beginners

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Investing in a rental property for beginners

What is a rental property?

A rental property is a home that is purchased by an investor and inhibited by tenants on a lease or other types of agreement, it Is best for individuals or households e.g stand-alone, single-family homes, apartments, duplex, etc

When should you start to purchase a rental property? What to look at

  • Do you have debts?

You should start investing if you know that you are debt-free, if the return on a rental property is greater than the interest you paying on your debt, invest in rental property


If you have credit card debts with higher interest, don’t buy a rental property because the return you will get is less than the interest on debts

  • Do you have a down payment?

The down payment is that money you will pay for a rental property in cash

You need to know how much money you need to pay before getting a loan from the bank

Ensure that you have a down payment of over 20%, this is where banks will be willing to offer you a loan

Don’t borrow money for a down payment; if you do this, there are higher chances for you to even lose your mortgage

Banks don’t want to invest money into a property where the investor has less money, they fear making losses

  • What is the interest rate on your mortgage?

Some banks or money lenders charge higher interest rates; you need to know how much interest they are going to charge

Shop around and find a financial institution that will offer you money at an affordable interest

  • What is your return on investment?

By investing in rental property, you need to ask yourself how much money will you get in return, what will be your cash flow, what expenses are you likely to incur, how long will it take for you to pay off the mortgage? What percentage return will get

Real estate investing for beginners

Basic real estate terms

  • Single family home

A home for a single family to live in

  • Duplex

A home with two separate doors for people to rent

  • Condo

A home with other different homes connected together

  • Mortgage

The difference between the price of a property and down payment, it is an amount you borrow to supplement your down payment

  • Cash flow

Cash flow is the amount that you earn from owning a home

How to build wealth with passive income? Best ways to get assets to buy liabilities

Are you looking for the best ways to build wealth passively? If yes this article is for you, in this article, you will learn how to use assets to buy liabilities

“if you cannot find a way of making money while you sleep, you will work until you die”

This simple strategy will help you build wealth in the most effective way


How to build wealth using the OPM strategy?

The OPM strategy refers to using Other People’s Money to build wealth

How does the OPM strategy mean?

Assuming you want to get a residential house, a residential house is a liability because it takes away money from you,

Assuming that this house costs $50,000 and you have $50,000 in your saving account

So what should you do? Should you use $50,000 to purchase a residential home and remain with zero or invest it into asset that will generate more revenue?

The best thing to do is to buy assets to generate cash flow that you will use to purchase liabilities

The best assets to invest in include stocks, real estate, mutual funds etc

By investing $50,000, this will make you earn money while you sleep,


Once the cash flow from your investment starts coming in from the assets, you can use the profits to buy liabilities

This is how the OPM strategy works

You will be earning money passively by leveraging other people to use your money to produce more money for you.

Once the amount of cash flow accumulates and you reach the amount of money to purchase a residential home, you can buy it,

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