{"id":25590,"date":"2016-01-15T13:38:38","date_gmt":"2016-01-15T13:38:38","guid":{"rendered":"http:\/\/lux.www2.realat.lv\/wordpress\/lv\/?p=25590"},"modified":"2016-01-15T13:38:38","modified_gmt":"2016-01-15T13:38:38","slug":"invest-residential-rental-property","status":"publish","type":"post","link":"https:\/\/www2.realat.lv\/en\/realat\/should-you-invest-in-residential-rental-property\/","title":{"rendered":"Should You Invest in Residential Rental Property?"},"content":{"rendered":"<p><\/p>\n<blockquote>\n<p>A few times a year, a client will ask whether he or she should invest in a residential rental property. The conversation usually starts out like this, \u201cMy neighbor said he has a rental property and is able to write off all kinds of expenses.\u201d The client is usually an employee receiving a regular paycheck, maxing out their retirement plan contributions each year, very little in the way of investment accounts, and looking for a way to invest their money while reducing their tax burden as much as possible. I don\u2019t own any rental property myself, but I have worked with many clients who own rentals and I\u2019ve learned a lot about them over the years. The first thing I know is, being a landlord is not for everyone. If it\u2019s always been a dream of yours to chase down rent checks and get calls about clogged toilets at 3 AM, then by all means, buy a rental. But make sure you know what you\u2019re getting into first.<\/p>\n<\/blockquote>\n<p><strong>Owning a Rental Doesn\u2019t Mean You Get to Expense All The Things<\/strong><\/p>\n<p>Yes, when you own a rental property there are certain expenses you can deduct for tax purposes that you can\u2019t deduct on your personal residence, such as utilities, maintenance, and association fees. You won\u2019t be able to take a deduction for the principal portion of the mortgage payment or allocate a bunch of your personal expenses to the rental property. You do get a deduction for depreciation on the building itself (but not the land). Depreciation often works in your favor since you\u2019re able to take a deduction for the decrease in the value of the building when in fact real estate (typically) appreciates in value. However, when you eventually sell the property, your basis in the property will be reduced by the depreciation you claimed over years, and you\u2019ll pay tax on the difference between the sales price and the adjusted basis of the property.\u00a0<\/p>\n<p><strong>Finding a Good Rental Property Isn\u2019t Easy . . . Neither is Getting a Loan to Buy It<\/strong><\/p>\n<p>When the housing market was in the tank a few years back, investors were paying cash for properties at unbelievably low prices. Now that real estate prices have recovered, you\u2019re probably not going to find a good property at a bargain. If you find an inexpensive property, it will most likely be a fixer-upper and you\u2019ll need the resources and time to get it into rentable shape.<\/p>\n<p><\/p>","protected":false},"excerpt":{"rendered":"<p>A few times a year, a client will ask whether he or she should invest in a residential rental property. The conversation usually starts out like this, \u201cMy neighbor said&#8230; <\/p>\n","protected":false},"author":2,"featured_media":7441,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,35],"tags":[],"class_list":["post-25590","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-realat","category-zina"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Should You Invest in Residential Rental Property? - REALAT.lv<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Should You Invest in Residential Rental Property? - REALAT.lv\" \/>\n<meta name=\"twitter:description\" content=\"A few times a year, a client will ask whether he or she should invest in a residential rental property. 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