Investing in real estate can be tricky, especially for beginners.
But with the rise of the FIRE (financial independence, retire early) movement and investment strategies like house hacking, for many, it’s never been more appealing to invest in rental properties.
Generating passive income is a huge incentive for investors, and rental income is often viewed as more of a long-term investment strategy that allows a property owner to build wealth while often taking on less risk than investments in volatile markets like stocks and bonds.
But there’s still a lot to be mindful of when buying a property. Tenant laws vary by state, mortgages can be costly, and there may be unexpected expenses lurking beneath a home’s surface that an investor may be unprepared to face.
That said, Business Insider asked Mike Hills, the vice president of investment brokerage for Atlas Real Estate and a property manager, what an investor should know before closing the deal. Business Insider previously reported that Hills employed a house-hacking strategy to build an $8 million real-estate portfolio.