Examine your goals. Make sure the prospect of owning another piece of real estate fits your attitude and your overall portfolio. If your portfolio is already diversified and you are saving enough for your retirement, buying real estate is an investment option worth considering.
Evaluate your personality. Do you possess the right attitude to own and maintain real estate? Don't underestimate the depth of the commitment. Do you have the skills and stamina to deal with all the issues that come with having tenants?
Are you comfortable enough with the risks associated with real estate ownership? Remember, you could be exposed to potential lawsuits from tenants and others who are on the premises.
IMPORTANT NOTE: Real estate ownership requires a larger commitment of capital and is illiquid.
Evaluate your analytical skills. You will need bookkeeping skills to track your income and expenses. Analyzing the return on your investment is also important.
Understand and accept the potential consequences. This could be a money loser and a stressful undertaking.
Make sure you understand the tax ramifications of owning rental property. You might want to consult with your tax professional to see what impact the purchase may have on your particular tax situation before you buy.
Remember, the responsibility of owning a second piece of real estate can be overwhelming.
Investment and insurance products and services are offered through INFINEX INVESTMENTS, INC. Member FINRA (Opens in a new Window)/SIPC (Opens in a new Window). UniVest Financial Services is a trade name of UniBank. Infinex and UniBank are not affiliated. Products and services made available through Infinex are not insured by the FDIC or any other agency of the United States and are not deposits or obligations of, nor guaranteed or insured by, any bank or bank affiliate. These products are subject to investment risk, including the possible loss of value.