|Buying Prescott Income Property and Residential Real Estate
|Purchasing real estate is an effective long-term investment strategy.
|There are several types of residential income-producing real estate, each offering different levels of revenue potential and carrying varying degrees of risk.The most basic of these types of real estate include:
- Duplex (two units)
- Triplex (three units)
- Fourplex (four units)
- Rooming house (many rooms with shared kitchens and bathrooms)
- Low-rise apartment building
- Mixed-use commercial and residential
- Properties that need to be fixed up for resale
Whether you are an investor who is looking to purchase a property that nets you a profit each month or a home buyer who wants to find a smarter way to bear the cost of home ownership, we have the information you need.
|Buying Prescott Income Property as an Absentee Investor
|Why invest in prescott real estate that you will not live in?
- Cash Flow: Rental incomes generate positive cash flow – the monthly net proceeds after all expenses and carrying costs on the property.
- Leverage: Income properties allow for positive leveraging – a situation where the yield to an investor exceeds the overall rate of return that would have been realized on a property had no financing been put in place.
- Return on Investment: The intention to achieve a strong R.O.I.- the dollar amount returned on an initial cash investment expressed as a percentage.
- Capital Appreciation: The potential for capital gains if the property can be sold for more than was paid for it.
- Tax Benefits: Potential for tax benefits by writing off mortgage interest against income. Also, capital gains on reversion may be taxed at a lower rate than other forms of income.
- Tax Benefit Potential: Gained by writing off mortgage interest against income. When you sell, capital gains may be taxed at a lower rate than other forms of income and there may be tax exemptions if the property is the principal residence.
- Beat Inflation: Land becomes more valuable every year. As your property appreciates, it can provide a good hedge against inflation.