One of the best things about real estate investing is the way you can be creative with your investment choices. Through real estate, there are very few limits as to how you can express your business acumen and creativity to realize monetary gains for you and your loved ones. This blog post explores an exciting real estate investment idea you may not have thought of. It regards a subtle distinction in your real estate investment planning that offers—not only a financial gain—but a personal one, as well.
Single Family Home Rentals Offer Abundant Cash Flow
There’s no doubt that single-family rental homes provide the opportunity for positive cash flow. In burgeoning growth areas like DFW, the limited inventory of single-family home rentals has created an enormous opportunity for real estate investors to maximize rents. When you take into account a turnkey real estate investment company such as American Real Estate Investments, the equation includes top-class properties, quality tenants, and reliable rental income. If you’re new to real estate investing, you can’t go wrong by considering a single-family home rental as your first investment. And, by investing close to home in the Dallas Fort-Worth area, you can carefully review just how thorough and detailed AREI is with all the houses they prepare for investors. But once you’ve got that first investment under your belt, there’s something even more interesting you can do for your family with your investment funds.
A Twist on an Old Favorite
Vacation rental properties can be just as profitable as single-family rental homes in your area. In essence, you’re still the landlord of a single-family property. But the purpose of the tenancy is for short-term vacation stays rather than long-term residency. Plus, vacation rental homes have the added value of being accessible to you and your loved ones when you wish to vacation out of town.
The Benefits of Vacation Rental Properties
Let’s review some of the many benefits of owning a vacation rental home in a faraway destination. For example, Belize is one of the attractive markets for vacation rental properties that AREI offers potential investors. Belize is a beautiful country with natural and manmade amenities that make it a top destination for vacationers and investors alike. It’s a country where you can realize your real estate investment goals and reap all the following benefits of vacation rental properties.
- Higher Rents and Better Cash Flow
Vacationers naturally expect to pay more when renting a vacation property than for a single-family home rental with a year’s lease. Where you might get $2500 a month for a single-family home in DFW, you could get $2500 a week for a top class vacation rental property in a place like Belize. (These are example figures only and don’t reflect any particular real-world prices.) The higher rents you can charge for vacation properties help create positive cash flows for your real estate investment portfolio.
- Free Vacation Accommodation for Your Family
When you own a vacation rental property, that accommodation is available for your personal use, as well. All you have to do is have your real estate property manager save one or several weeks out of the year for your use. Then, when you’re ready to vacation, you stay in your property at the desirable destination, such as Belize. That’s added vacation savings that can amount to thousands of dollars.
- Tax Advantages of Vacation Property Ownership
There are tax advantages of owning a vacation rental property. First, because it’s a real estate investment, you are entitled to all of the ordinary deductions for expenses, such as repair and maintenance, property management fees and depreciation. You will have to apportion the costs deducted according to how much time you and your family stay at the property. For instance, if you use the vacation rental for 10% of the year, you can deduct up to 90% of those expenses. However, according to IRS rules, if you use the vacation property for personal use 14 days or less, you are entitled to deduct 100% of the expenses allowed. There are other IRS rules governing vacation rental properties, and your tax accountant is the best source for guidance.
In summary, single-family home real estate investments will always be potentially attractive and profitable. But when you want to add personal value to your real estate investment portfolio, you can’t go wrong with a vacation rental property. It doesn’t even have to be a traditional single-family home vacation property. In Belize, for example, many beautiful condo and villa properties have excellent rental potential. If owning a vacation rental property sounds appealing to you, please contact American Real Estate Investments today.