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Everyone loves to have an option of reliable returns on his investment, whether it is on the property, stocks, or other options available. As much as the idea appeals to everyone of having a passive income, it drags along the responsibility of a lot of active work.

In the case of rental homes, sometimes, they require more maintenance work than your actual house. You still have to fret over the unpaid rent from the tenant, keep up with the housing laws, and satisfy your tenants.

Although there is a healthy demand for rental properties, and scope for landlords, there are still some factors to be considered seriously. Before jumping into this world, you should look into the advantages and disadvantages of owning a rental property and see for yourself.



Your rental property can indeed provide you with extra income monthly. It is the biggest advantage of renting out a property. The revenue generated from rent can pay for your mortgage. It provides steady cash flow, and with permanent tenants, your bank account may have the figures you always dreamed of by the end of the year.



Investing in rental properties is a remarkable start if you're looking for a career in real estate. However, even if you don't want to go down the real estate road, you will still find rental properties quite the eye candy. In addition to increased cash flow, you still would own the property, and you can sell it any time you want.

You should carefully determine where you want to invest, for example, office space, apartments, family spaces, or industrial.  You would also get investment leverages on rental properties, and can quickly get loans from banks for further investments.



Appreciation is defined as the increase in the investment property's value over time. By the time you wish to sell your property, the rate would've gone up, which will eventually benefit your Return of Investment (ROI). You can hold on to your property if the real estate prices fall, but when they go up again, you can look forward to selling your property. You can also take inspiration and information from any genuine property management sites on this matter.



Investment in property is also considered to be a secured and low-risk investment. If you have a property in a prime location, you will never be short of tenants. Even in times of economic crisis, people will still need houses to live in and pay their property rents.



With the addition to a steady job, rental properties help boost your monthly income. Rental property income can add up easily to your salary, and it can give you the benefit to retire before time. Your cash flow from your rental property can provide funds for your retirement plan.




There's no doubt that tenants can be handful most of the time. They are your responsibility, and if they cause any kind of problems, you will be dealing with consequences. It is hard to find good tenants; there's no guarantee that your tenant would pay rent on time every month. Even if they pay on time, there's always a chance of them destroying or damaging your property. Some can even be very demanding, manipulative, and complaining and can go as far as suing you.



Most landlords wouldn't admit, but this business is time-consuming. It is no one-step job and requires time since the very first step. From the day you buy a property, to your search for suitable tenants, to maintenance - this requires active involvement from a person. It involves paperwork, monthly visits to the property, checking for repairs, keeping up with the modified property laws, and market worth.



Maintenance would come up eventually. Even with good tenants, there's no guarantee your property will be immune to any kind of damage. In the case of natural disasters, you will be the one who will have to face the music. You are by law required to repair the damage, and for this, you need hefty capital at hand.

Your repairs can cost you thousands of rupees and even more to drag your tenant to court; the law favors them more than you. You will also need additional insurance since most policies provide homeowner insurance for homeowners who occupy their property themselves.



The rise and fall in the property market are unpredictable. You may have over anticipated your property's worth, and now you might suffer financial loss. Or you may have under anticipated your property's value and you earn way less than you should. It can lead to further complications such as overdue bank loans or property vacancies that can prolong for months.



As mentioned before, the law is more favorable to your tenant then you. If you fail to provide the necessary repairs or needs on time, your tenant can walk out on the lease or even hold back rent without facing any consequences. Moreover, loopholes in your contract and lease can add up to the obstacles when retaining your property or official complaints.



Most people prefer renting out properties as a secondary job to their primary one. However, they fail to anticipate the potential stress it drags along. In times of vacancy and low market value, you can end up losing most of your invested money.  Plus, looking for a suitable tenant, covering up the additional expenses, taking care of all the paperwork would not only consume your time but also add to your stress. It can heavily influence your health in daily life as well as damage your primary work performance.



All in all, the rental business is not just roses; it also has some thrones attached to it. This business may be a delight for some and a significant stressor for others. Your finances need to be sufficient as you are ready to take up this job. My advice to you is before you dive into this business, contact professionals who can help, guide, and assist you throughout. Hire a lawyer and a property manager who could take care of the legal issues and other matters. It can reduce the chances of all your drawbacks and strengthen your odds at success.



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