How to Make Money From a Rental Property

By Dylan Suitor

My true passion is to create generational wealth; generational wealth for my family, my future family, for my friends and of course for our clients. Whether you are a first-time or seasoned investor, looking for single family investments, duplexes, tri-plexes etc, multi-family investing, student rentals, vacation homes or a rent to own. I can assist you in getting started and teach and guide you on how to grow your own portfolio. I have focussed much of my attention over the last few years really understanding the process involved, in order to best serve you, our client.

How can you make money from a rental property? There are different ways to leverage your property, and one of them is by sharing with you four ways that you can profit from your rental property.

1. Cash flow. Positive cash flow is the simplest way to earn money from rental properties. This means making sure that the rental income exceeds your monthly expenses. Are you looking at $200, $500, or $1,000 a month? Understand and set realistic cash flow expectations. Are you going to lock in your rate or have a variable rate? Some variable rates change if bond yields change, like the Bank of Canada, while others fluctuate based on the amount of principal and interest.

2. Appreciation. Although this is not guaranteed in the short term, it is a reliable way to build wealth in Canada over the long term. You’ll see a consistent increase in home values for properties held for 10, 15, or 20 years.

3. Mortgage paydown. This is often overlooked in rental property ownership, even though it contributes a lot to accumulating wealth. If you have two or three tenants paying your mortgage, maybe 30% or 40% of that at the beginning, the mortgage payments go towards the principal, which is the mortgage paydown amount. So if it’s a $500,000 loan, you may be paying down some of that loan, plus interest on top of that $500,000.

4. Forced appreciation. Actively improve your property to increase its value. You can make strategic changes like creating legal rental units and upgrading electrical panels. Consider making major renovations like roofing, furnace replacement, or backyard improvements. These are some things you can do to add value, modernize the home, and sell for the most possible amount.

Elevation Realty Network is a team of experienced real estate agents who want to help you create wealth through investing in real estate. We’d love to talk with you and discuss different ways to increase the value of a home and make money. Book a call today by calling us at (289) 769-8998 or sending us an email at info@ElevationRealty.ca. We will gladly connect you to our network of partners to help you get the best home and make the most out of your property.

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Disclaimer: The information provided in this video is for educational and informational purposes only. It is not intended to be financial advice. Please consult with a licensed financial or real estate professional before making any investment decisions.