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Every Rental House is like a small 401(k)

Savings interest rates have been hovering around 1% for the past 10 – 12 years, while inflation has been exceeding 5% per year for the past two years. The stock market has had its ups and downs, some sectors have done well and others have gotten clobbered.

It’s difficult for most of us to figure out how to grow a nest egg without getting it being eaten up by inflation, devaluated by the sudden whims of the stock market, and erosion by the numerous fees on investments vehicles.

After the great recession (circa 2008) our company started going all-in on Rental Houses, buy-fix-hold-rent, in particular, is our flavor of choice but we will also do buy-hold-rent of turnkey properties if the numbers make sense.

We’ve come to look at each rental property like a small 401(k) retirement saving account. Of course, rental houses aren’t actual 401(k)’s but when acquired and managed properly they can provide significant long-term savings benefits such as appreciation, monthly cash-flow, cash-out ability as well as several short-term and long-term tax advantages.

There are at least 5 potential areas to profit from with a rental house investment:

  • Appreciation – the increase in value of the home over time
  • Monthly Cash Flow – the amount of money left over each month, or each year after paying all expenses such as mortgage, taxes, insurance, property management, repairs..etc.
  • Cash Out Ability – the equity over 30% of market value in a rental property can be unlocked/withdrawn in certain conditions by refinancing.
  • Annual Tax Savings –  being able to claim legitimate business expenses against the property, taking generous depreciation deductions, and extending the SALT (State and Local Tax) deduction limit are some of the most popular tax savings methods available to Real Estate investors.
  • Long-Term Tax Savings – capital gains treatment, 1031 exchanges, and tax-deferred retirements accounts are some of the long-term tax savings vehicles available to real estate investors.

Not all properties will always realize all of these potential benefits as real estate investors often have different wealth-building objectives and tax situations. It’s always helpful to seek the advice of attorneys and accountants who are well versed in real estate investing before taking the plunge.

One of the things that tend to hold would-be investors back is Fear of Tenants, as there is no shortage of bad tenant stories. Attracting, selecting, and retaining quality tenants, providing and enforcing a strong lease, and dealing with repairs on a timely basis are key to operating a successful rental property.

Bassett Property Management takes the stress out of the day-to-day tenant side of the business by providing management services to their clients. Visit our website at http://www.bits.ws to learn more.

Short-term Rentals – Airbnb & Vrbo

Visit all of our Airbnb & Vrbo listings by clicking here

Jennifer and I understand the importance of excellent 5-star Guest Hospitality through the eyes of being extensive travelers. We have stayed at many Airbnb’s and spent hundreds of nights in hotel rooms. These many travel experiences have influenced the way that we have set up our Airbnb locations. In addition to our Airbnb Hosting: I am a local real estate rental professional, a college professor (project management and entrepreneurship) and the Past President of a local Rotary Club. Jennifer is a director at a National Healthcare Consulting Firm. We live within a few blocks of our Airbnb properties.

 

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Scary Hoarder House Project for B&B Realty

I just closed on this project house with my partner, it was a short-sale. The deal was that we had to take it ‘as-is’ with all of the treasures.

This spacious North Haven home features 4 bedrooms, 2.5 baths, and a ton historic charm.

This house was remodeled about 12 years ago but has been so neglected and cluttered that it is in need of major clean-up, modernization and a double dose of love.

Watch our progress as we turn this hoarder house into a stunning beauty over the next 45 days or so. It should be ready for move-in in time to enjoy the Holidays.

Contact Rick Bassett

 

 

New Project House – Pool Rd Project #3

We just came to agreement on this nice 1200 sq/ft brick house on a corner lot of Pool Rd in North Haven, CT  and plan to start the updates & renovations in about 30 days. When done it will  be a 3 Bedroom / 1 Bath / 1 Garage Bay with a full unfinished basement that boasts all new windows, new doors, new appliances, fresh paint, refinished hardwood floors, completely updated electrical and plumbing, a newer gas furnace and a new central air system.

Know anyone interested in renting it?We plan to have it available in Early June.

We will rent it for $1595/mo if lease commitment is made before renovations are done and $1695 after that.