Rental Arbitrage- The good, The bad
Photo by Jose Alonso @ unsplash.com If you're thinking about getting into the rental arbitrage business, you should be aware of both the advantages and disadvantages of the practice. Rental arbitrage is the process of locating undervalued properties, usually foreclosures or short sales, and then renting them out at a higher price point. While successful rental arbitrage can result in significant financial rewards, there are also risks that should not be overlooked. Reasons it works as a profitable business model: 1. Rental properties are always in demand. 2. Since you don't have to purchase the dwelling or property, you don't need much money to start. 3. Relatively Low-Maintenance. The risks: 1. The actual owner must not have "claused" out this option to "sub-let" the unit. 2. Wear and tear, emergency repairs may be up to the owner or property management company to contend with, so you want to make sure the unit and building are already well cared for a...