New to real estate? Looking for ways to increase revenue from your real estate investments? Begin with this list and start increasing your revenue today.
1. Hire a property management company
Do you rent your investment properties to tenants? Are you doing all the work of a landlord to save money? If so, you’re actually preventing yourself from increasing your revenue. Being a landlord requires spending a significant amount of time running to and from your properties and scheduling or performing repairs. If you’re a serious investor, that doesn’t leave you any time to focus on growing your portfolio.
If you’ve never considered it, you’d be surprised to see how beneficial it is to hire a property management company. The main benefit is that your tenants will be taken care of and you’ll have more free time to manage existing investments and search for new deals. When managing tenants and handling repairs is your full-time job, you won’t have time to generate more income.
Hiring a property management company will cost you a monthly fee, but that fee is your ticket to growing your investment portfolio.
2. Refinance existing investment properties
Refinancing your investment properties can speed up the time it takes for them to become profitable. The sooner you pay off your mortgage, the sooner your tenants’ rent will be pure profit. According to Investopedia, it’s worth refinancing when you can:
- Get a new loan with a lower interest rate by at least 2%. A lower interest rate increases the speed at which you build equity and can decrease your monthly payments.
- Shorten the terms of your mortgage so you’ll pay less interest
- Switch from an adjustable-rate mortgage to a fixed-rate mortgage
Refinance for the right reasons
Be cautious about refinancing to tap into your property’s equity to pay off debts or to reinvest the money. If you need capital for new investment, stick to traditional loans unless you have absolutely no other option.
Refinancing is a good strategy when used strategically. However, be prepared to pay between 3-6% of your loan’s principal to refinance. You’ll also be required to get an appraisal and go through the application process again. Make sure the money you need to spend to refinance doesn’t exceed the amount of money you need for investment purposes.
Refinance out-of-state and overseas investments
If any of your investment properties are out-of-state or overseas, consider refinancing those investments as well. Each state or country will have different rules and methods for refinancing, some of which are more convenient than others. For example, if you have property in Australia, you can refinance completely online through loans.com.au.
3. Establish additional streams of income
To get revenue flowing into your bank account as quickly as possible, consider setting up additional streams of income even if they aren’t related to real estate.
Seth Williams from Retipster has several side hustle suggestions for real estate investors that include becoming a notary, real estate wholesaling, and affiliate marketing.
Becoming a notary can bring in cash on your terms
Getting certified as a notary is easy and you can work for yourself. You don’t need to rent an office, you just need to advertise your services as a mobile notary and be willing to drive to your clients. People need notary services constantly and are willing to pay good money for mobile notary services.
Real estate wholesaling doesn’t require a license
Don’t have a real estate license? No problem. Real estate wholesaling doesn’t require a license. With wholesaling, you find a property for sale and contract with the seller for a price. Then, you find a buyer and contract with them to purchase the property at a higher price. You keep the difference as profit.
Real estate wholesaling isn’t for everyone, but if you’ve got the time and energy you can generate some sweet income.
These are just some examples of side hustles you can take on. Some ideas require more of your time and you might be limited regarding how much time you can give to your side hustles.
Ideally, you should set yourself up with a source of income that doesn’t depend on your time. For example, selling a digital course to your website subscribers.
4. Work on your investment strategies
Nothing is more important than working on your investment strategies and building your expertise.
There are many different ways to invest in real estate and you might want to try your hand at something new. For example, Good Financial Cents published a blog describing four ways to make money with real estate investments. The four ways include:
- Investing online. Some online sites require verification that you have a certain minimum net worth. However, you don’t need to be an accredited investor to use sites like Fundrise. Online investing may not bring in big bucks, but it’s relatively hands-off and easy.
- Leasing with the option to buy. Signing an agreement giving you the exclusive right to buy the property gives you the opportunity to make money without paying a dime. You just need to find a tenant willing to sign the same agreement but pay you a non-refundable deposit for exclusive rights to buy.
- Optioning properties. This investment strategy is similar to leasing with the option to buy, but differs in that the property isn’t leased and the seller can still live in the house while payments are being made.
- Wholesaling properties. Wholesaling is when you buy a property at such a low price that you can turn around and sell it fast to someone who wants to rehab the property. This strategy works some of the time, but you may need to make 100 offers before someone will accept.
Stay open to new ideas, but stick with what works
As you gain experience with various investment strategies, you’ll find that some are better than others. Although all legitimate real estate investment strategies work, stick with the ones you enjoy and have the energy to follow through with.