Top 5 Benefits of Owning a Rental Property in Calgary
There are several major advantages to owning a rental property in Calgary, the main and most obvious one being the potential to earn passive income.
Alternatively, some landlords may find pride in ownership and increasing their investment portfolio to be part of the appeal, while others may be more interested in the financial advantages of growing their asset worth.
Whichever the reason you want to own a rental property, we are sure we have it covered on our list below.
Here are five of the most pertinent advantages to investing in a rental property – like a garage suite in your backyard!
#1 – Earn Passive Income
The ability to generate a secondary income is one of the most significant advantages of owning a rental property in Calgary. For those who want to make some money on the side or have additional financial security during retirement, investing in real estate to lease as a rental property is a popular choice.
Before investing in a rental property, you’ll want to calculate your potential cash flows based on the projected income you’ll earn from a particular unit. Also, make sure to take your expenditures into account, things such as:
- Mortgage payments
- Utility bills
- Property tax
- Maintenance and repairs
Once you’ve determined your cash flow, check whether the figures indicate that you’re able to maintain a net positive revenue stream from the rental property and that your profit is high enough to make it an appealing business venture.
#2 – Improved Security
If you own a rental property like a tri-plex, or perhaps a garage suite in the backyard (like the ones we build), you’ll benefit from improved security since there will be multiple tenants living on one lot.
Tenants typically look out for one another when it comes to the security of their homes – and your property. With the common goal of keeping their own family and assets safe, they also inadvertently are protecting your investment at the same time.
#3 – Diversification of Assets
The power of diversification is essential to any successful investment portfolio. With a variety of investments, you are able to manage risk more effectively and prevent one bad event from reducing your entire portfolio to rubble.
The real estate market is one with its benefits visible in the numbers. Owning a rental property gives you a foothold in the real estate market while also providing financial security and extra cash flow.
The potential for your rental property to appreciate its value is also possible given your investment was made using the best advice from a Calgary real estate expert.
#4 – Potential Value Appreciation
As mentioned above, the potential for price appreciation in the local real estate market is always a possibility, especially if you’re choosing to build a new garage suite on your current lot.
Building a new accessory residential dwelling (ADR), as the City of Calgary likes to call them, is a no-brainer to increasing your own assets while also improving the assessed value of your home.
However, it is important to note that the residential market never acts congruently across all segments. The condo market, for example, may see price drops, while the luxury infill segment may see price appreciation.
Talk to any real estate agents and investors you trust before buying a rental property, and do your due diligence to protect your investment as best you can with the information at hand!
#5 – Control of Your Investment
There’s no telling how much control you have over alternative investments, like any you’ve made in the stock market, for example.
However, as Landlord, you’re in charge of almost everything first-hand: budgets, contracts, renovations, and ultimately which tenant lives in your rental property.
Owning a rental property in Calgary – like a garage suite – gives you the ability to have more fluid control over your investment versus other more potentially volatile forms in your portfolio.
Protect Your Investment
Leasing a property can be profitable and personally beneficial. But it is important to acknowledge that any investments, including those in real estate, come with inherent risk. Thankfully, there are measures you can take to protect your investment.
Implement a strategic tenant screening process that will assist you in protecting your investment property over the long term. Perform the following:
- Credit check
- Criminal history
- Eviction history
- Payment history
- Social media scan
- Google name search
The information found during these checks above should help you decide on what tenants to allow and minimize the chances of late payments, damage to the property, and other financially draining and stressful occurrences.
Invest in a Garage Suite?
Now that you know more about some of the benefits of owning a rental property, it’s time to think about what this could mean for you as an investor. By carefully considering the benefits listed in this article, you should be on the way to making sound decisions about your property and safeguarding your investment for years to come.
Garage suites are an ideal type of rental property to own. Located in your backyard, they provide you with a secondary income, increased security, and are manageable just an arms’ length away from your principal residence. They can also be diversified, allowing you to move your parents close to home or perhaps use for a new home office whenever you need to make the shift.
Contact us anytime at 403-797-4918 to discuss your investment goals if a garage suite in Calgary is something that interests you and we’ll be happy to help!