So you’ve decided to become a landlord. This can probably be a very wise investment in your part. But have you thought about who you will be renting to?
Think about this when you purchase your rental property. Who is the typical tenant in that particular area,? Is it a complex mostly filled with young couples just starting out in life? Is it the type of place where people rent because they don’t have the financial ability to purchase a home? Is it a place where people will rent while they’re getting back on their feet after a financial setback? These are all things to think about.
But let me tell you about the segment of the rental market that I think makes the most sense. And that’s the senior citizens.
Many seniors, when they sell their home, they don’t want to purchase a new one. They want to have the cash available that they can travel, use for health purposes, help the children or whatever. They don’t want to have the capital they have saved after all these years tied up in a house. So they want to rent.
Also sometimes they don’t want the responsibility of having to maintain a property. They figure let someone else worry about that.
One of the nice things about seniors is when they rent a home, they tend to stay there until they no longer can physically stay. They don’t tend to move every year at the end of the lease. As landlord this is important to you. After a tenant has moved out, you will have to get a new certificate of occupancy. You’ll probably need to paint, possibly replace carpets, and will probably have a unit that is vacant for one, two or three months – however long it takes to get a new tenant. And quite often, unless you do it yourself, you’ll need to pay a Realtor the first month’s rent to get that tenant in there. So a tenant who will stay there year after year after year is a good thing.
I also find seniors take much better care of the property than young kids. Why? Because they stay there and have, for the most part, better values in life. I also find the seniors tend to pay their bills better.
So if you’re looking for a good investment and you want to purchase a property for rental, consider who you will have as a tenant.