My apologies for the hiatus, but I’ve been busy doing something I hate. Something I despise. Abhor, even. It’s been the bane of my existence (and the reason my social life has been on pause) for the past month, and it’s finally coming to a close. I’ve been moving.
Granted, my reason for moving has been positive and wonderful. I’ve taken an important step on my financial path by purchasing a multi-family home. That’s right; I’ve become a landlord.
True, I already work full time. Yes, this will add to my list of responsibilities. However, it’s done some positive things for me, such as:
- Diversified my income. Most of make our income by working. By purchasing a home that can get rent from, I’ve created an additional stream of income, called passive income. Passive income is money that you can make without having to work (Making money for no work? Yes please!). Lots of über-rich people do this. They call it collecting money on their investments. may not be among the ranks of the Warren Buffetts of the world (yet), but everyone has to start somewhere.
- Taken a significant step towards paying off my mortgage. True, I have a mortgage and it will take years for me to pay off. However, the passive income I am making from rent covers all but $300 of my mortgage each month. That means all I am responsible to pay for are the taxes, insurance and utilities/home improvements. Granted, these expenses are significant, especially in my area, but it’s more palatable when your mortgage payment is minimized.
- Invested in an asset. Property values have been volatile, and are down at the moment. I was lucky to get a deal on a property which I never would have been able to afford before the property bubble burst. Coupled with an exceptionally low fixed interest rate on my mortgage, I really feel like I’ve scored. With some luck, my property will appreciate in value over the years that I plan to own it, creating another opportunity to make money on my investment.
True, every investment comes with a risk. But with proper research and planning, I’ve done my best to invest in a property with the potential to appreciate and produce income. Now, readers, I’m looking for suggestions for cost-effective home improvements. Comment below!