We all know the obvious income method on rental properties, rent. However, there are other ways you can make money each month after all the expenses are paid. Other cash flow opportunities include the following:

• Natural Appreciation – Natural Appreciation is the increase in the value of your property over the time you own it. This is one of the most generous advantages of investing in real estate. This is only realized upon sale but could be a substantial profit.

• Forced Appreciation – Forced Appreciation is when you as the investor improve the property’s value through fixing it up and making improvements to the property. This type of appreciation is the fast way to increase value and is not impacted by the uncontrollable market. This is the quickest way to gain equity on the property.

• Equity Pay Down– Equity Pay Down is the is the fair market value of a property minus the remaining mortgage. It is calculated by subtracting the amount owed from the value of the asset/property. Every month that the mortgage is paid by your tenants, the balance of your mortgage decreases and you equity increases.

• Tax Benefits – Every year that you file your taxes while owning an investment property, you can write off the general expenses, depreciation, and any other perceived losses. This is a complex process and you should always consult a tax expert. Through your tax deductions, you could have tax free income or even receive a tax refund.

If you’d like to further discuss this topic or any other investing goals with our team, send us a message or schedule a complimentary call