In a previous post, we’ve discussed the many advantages of starting a side hustle venture to provide an additional source of income to your household. Side hustles can not only help diversify your income, but they can also be scalable. If they are successful, you can grow them and boost your income even further.
You may be considering different options. But if you are looking for an investment that doubles as a side hustle, starting a rental business in your spare time can be a wonderful way of securing a passive source of income.
Becoming a landlord can be profitable
Landlords have an average income of $97,000 a year by combining all their income sources. Indeed, it is important to remember that a landlord collects around $34,000 a year in rental income but only profits of about $10,000, which is a profit margin of just above 30%. Becoming a landlord is not the quickest strategy to unlock new wealth. But it can be a safe investment strategy for reliable, long-term secondary income.
Most landlords choose to invest their rental income into savings or to finance side expenses and projects, such as holidays. It offers more financial breathing room.
You don’t need to purchase expensive properties
Around 4 in 10 landlords own less than $200,000 worth of real estate, even though they own, on average, three properties. With the median house price reaching over $428,000 in 2022, it is fair to say that landlords don’t invest in the typical family home. Instead, they look at practical, functional, and budget-friendly properties such as mobile homes from Top Notch Homes. Ideally, as a landlord, you want to focus your attention on affordable rental properties, which can attract tenants with manageable rental fees. Indeed, as rental costs have increased by over 30% since 2010, it is fair to say that tenants also struggle to afford premium rentals.
You can’t do it by yourself
Running a rental side hustle venture can take a lot of time to:
- Manage tenants’ queries
- Proceed to repairs when required
- Help tenants with ad-hoc and unexpected issues
- Arrange visits for future tenants
- Screen tenants
Partnering with a professional real estate agent with access to the right tools and solutions to support rentals can help save time and hassle. Indeed, when most landlords already have a full-time career, it can be tough to be available for your tenants.
Social media can be a valuable promotional tool
Social media is a great place to reach potential tenants and market your rental property. But there are some crucial tips you want to consider:
- Make your contact information visible on your profile
- List available properties on all relevant social media platforms, including Facebook Marketplace (and update lists accordingly)
- Show all amenities; don’t make people guess
- Organize events such as open day visits or tips on managing utility costs
- Share useful content about the community and the property
- Use social media advertising to target your audience
Investing in real estate is one of the preferred investment strategies for new investors. Indeed, as real estate is one of the only tangible assets, it is typically more manageable for investors. Consequently, if you are looking to start a side hustle, real estate can also open the door to profitable and manageable hustle opportunities.