HOW TO INVEST IN RENTAL PROPERTY IN KENYA.

An Investment in Rental Property is the Way to Go Written By: John Mathenge.Real Estate Consultants. Contacts:+254 716 050 639 Most people already know that an investment in rental property is a great way to earn money. What not everyone knows though is how to actually make it the most beneficial. Some people will try their hand it rental property investment but find that they end up with a lot less money than they expected. This can be very disappointing. By making sure that you do your homework ahead of time, you will ensure that your adventure into real estate adventure is profitable. The first thing you want to do is to research your target area and determine what kind of rental property you want to invest in. Do you want only single-family homes or apartment complexes? Maybe you would consider a mixture of everything. Either way, it is wise to start small by beginning with just one property. This will allow you to get your feet wet. Get some experience with the business and then you can move on to expand your investment in rental property. There are two common ways that investors use to acquire properties. There is the traditional purchase where you pay what the seller is asking, which is typically the full value of the property. Then there are the county tax sales where you can purchase a property for a very small fraction of what you would have traditionally paid for it. The extremely cheap properties at tax sale are usually in need of a lot of repair. If you are a handy person, this may be the diamond in the rough you have been waiting for. There are numerous strategies through which you can buy properties below value. Once you have your property, you will want to make sure that you are checking with the town or county to check if there are any special permits or licenses you have to have in order to proceed with renting the property. Without the right legal documentation, you may not be able to see your investment in rental property make a full turn around. After all of the legal stuff is taken care of, it is time to rent your property. You will want to be careful when deciding who to rent to. You cannot discriminate but you must make sure that you are renting to a tenant who will pay you on time and who will respect your property. The best way to ensure this is to run a credit check and a background check. You might also want to ask for personal and professional references from the potential tenant. Make sure that your new tenant signs a lease or a contract. Even if you are allowing the tenant to live there on a month-to-month basis, you still want to make sure that your investment in rental property is secure. Outline the details about the security deposit, when the rent is due, late charges, causes for eviction and what the current condition of the property was when they moved in. Without a lease or a signed contract you will not qualify for a landlord insurance policy that protects you from tenant rent default and damage to the property. You will be able to sleep in peace if you are covered by landlord insurance. Your cash flow will not be interrupted in case you land up with difficult tenants who abscond with rent arrears. Even though there are a lot of steps to take to make sure that your rental property investment makes you the most money, it is something you have to do. You might find that it takes a while before you actually see a profit because of money you had to put into your investment in rental property but the wait is well worth it.