How to Turn Your Home into a Rental House

How to Turn Your Home into a Rental House

In a recent survey carried out by American Association of Realtors, an average American buys a total of 6-7 houses during their lifetime. If we keep these houses and use it well for the rest of our lives then it could be the best form to generate monthly long term income that would always be in the growing side.

Now normally what everyone does is that they sell their home where they live in to get the cash to purchase a new house. But right now we have certain benefits and opportunities that we can use a different procedure which can help us in increasing the net worth value of our old house as well as guarantee economic security.

Instead of selling your old home, you can just refinance it and use the same money as a down payment for your new house. This will easily help you own two houses so now you can just make your old home to rental house. It's the easiest way to make good use of the refinance options provide by many companies.

Advantages of turning your home into Rental House:

1) Now you get a new way of income flowing in the form of monthly rental amount from your rental house. This rental income from your rental house doesn't depend on your regular job as well as could work as security if you lose your regular job.

2) Initially you had a single house which would increase its value at an average of 5% per year. i.e. if your house is priced at $ 200,000 now, it will increase its value to $ 300,000 in a span of 10 years hence giving a profit of $ 100,000 in 10 years. Now when you have 2 houses, one where you live and one you have used as rental house, your profit would double up to $ 200, 000 in ten years.

3) Owning rental houses also provides retirement benefit that you can't get from your pension through your job after retirement. For example, if you had a government job for 13 years, when you retire you may receive a pension around $ 1000 per month which will be very low in a span of 10 years. Because of inflation, the cost of everything would have reached a peak in 10 years. But now if you take the case of your rental income from your Rental Houses, they go up too each year because of inflation as the property values are increasing every day. Thus investing in a rental property always helps in the long run.

Now if you purchase just one extra property and use it as rental house all your life, you financial security becomes guaranteed and will grow each year. So if you get a chance then grab the opportunity now because this is best time to have a rental house to generate secondary income that will secure your future too.

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