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Rental properties are a big investment, so making sure you are protecting your investment is a must! Here is a breakdown of what your landlord insurance can cover:

Property damage: This covers damage to the home itself and personal property due to fire, storm damage, theft, vandalism and tenant damage. Ideally, your landlord insurance will cover the replacement costs for your entire rental property in the event of a total loss.

Liability insurance: This coverage protects you against liability claims and lawsuits. Whether a tenant, visitor or even a trespasser is injured on your rental property, you could find yourself in a legal headache. Your liability insurance will help you cover these costs. These costs can include medical payments, legal fees and judgment or settlement costs. You will also be covered if you, as the landlord, are found responsible for another person’s property damage. For example, if you neglect to fix a leaking water pipe and mold damage destroys a tenant’s expensive collection of vintage albums, a liability claim can be filed against you by the tenant.

Loss of income: This insurance will help compensate you for lost income in the event that your rental property becomes uninhabitable due to a covered loss, such as a storm or fire. Your loss of income coverage, or “rental reimbursement,” will prevent you from losing the income you would have had if you were collecting rent.

Optional coverage: As a landlord, you can buy additional coverage, such as rent guarantee insurance, natural disaster insurance, employer liability insurance and landlord contents insurance to cover your personal property items such as furnishings or carpet in the rental property.

Be sure to contact your insurance company to ensure you are getting the best coverage possible for your investment or to go over additional options you may benefit from.

Arizona currently has the 22nd highest rent in the country out of 56 states and territories. In Maricopa County alone, with an estimated population of 3,817,117, the average 3 bedroom home rents for $1474. In Pima County, with an estimate population of 980,263, the average 3 bedroom home rents for $1242.

There is a high demand for 2018. This is due to two factors that will greatly impact Phoenix real estate: job and population growth. Phoenix real estate will benefit from the city’s growing economy. In 2017, Phoenix real estate investing was given a boost because of the additional 51,000 jobs added during the year. As of October 2017, Phoenix had an unemployment rate of 4.5%, the lowest the city has seen since 2007.

Phoenix has gone through a 140% increase in the number of companies that moved their location to the city, meaning good things for the Phoenix housing market.

Phoenix investment properties will be affordable, compared to the national index for housing affordability. According to the Wells Fargo Housing Opportunity Index, the national index is 58.3% for a median income of $68,000. For the Phoenix real estate market, the index is 65.8%. In comparison to other states, Phoenix investment properties will be pretty affordable for real estate investors and homebuyers.

Single family homes used as rental properties are also a good option for investing in Phoenix real estate. Real estate investors should even consider turning single family rental properties into dual occupancy rental properties to get more rental income.

Are you ready to join Arizona investors and build your wealth with real estate?

https://www.rentdata.org/states/arizona/2018

https://www.mashvisor.com/blog/phoenix-real-estate-2018/

There have been, and will continue to be, some big changes in the 2018 rental market. It’s important to understand the changes, meet owner and renter expectations and create a strategy.

It’s expected three specific groups will show high demand in rentals in 2018.

• Young Millenials; those who are just old enough to start renting

• Older Millenials; who are saving up for a down payment for a home

• Older Baby Boomers; who are looking to downsize

Rental analysis shows that dramatic rental increases will slow down for higher end properties. However there will be a steady increase for the low to mid-range home. Currently, there are fewer houses for sale among bottom- and middle-tier homes, which are the most affordable to new home buyers. Single-family rentals are also concentrated in the bottom tier, and activity there has increased in the past decade. This is key for landlords and investors looking for what will have the best ROI.

Rent growth, while remaining steady since 2012, is speeding up again. In general, keeping rent increase to 2-3% is favorable. Any higher and they outpace income increases. In fact, the areas where rents are increasing the most are those with good, high-earning jobs coming in.

“HOLD is a long-term real estate investment strategy to which every real estate investor should aspire.”

One of the simplest definitions of rental property investing is getting paid for what you own, rather than just paying to own it.

Benefits of investing in Single Family Homes:

• Income: unlike with stocks and bonds yielding about 2%, it’s possible to generate in the low double digits in returns

• Tax benefits: (https://www.tctproperties.com/blog/post/top-5-landlord-tax-deductions)

• Flexibility: unlike multifamily homes which demand upfront costs, with single family homes you can choose how many you want to add to your portfolio and your own costs

Make sure you do it right!

• Choose the right property: know what you are looking for; college town, family living, low maintenance, LOCATION, LOCATION, LOCATION, etc.

• Do the Math: make sure you understand your monthly costs and plan for maintenance costs as well. Even though it’s a rental, there is still maintenance that needs to be done and it’s important to understand and budget accordingly

• Hire a Property Manager: Shop around, find who works for you. Once you research and find companies you may be interested in, interview with them to find the perfect fit!

Are you ready to invest and start building wealth with real estate? TCT can help, call us today!

References:

https://www.forbes.com/sites/financialfinesse/2017/08/09/should-you-invest-in-rental-real-estate/#4839edf25c15

http://www.noradarealestate.com/blog/advantages-of-single-family-rental-properties/