Every year, more visitors are coming to Southern Utah and many decide to make Washington County their permanent home. With the influx of people, it seems like a great idea to obtain a rental investment property. But, like all investments, there are rewards and risks associated with managing a rental that you may not have considered: 

Rewards: 

  • Passive Income. This is probably the most attractive reward, as managing a rental property can often be done while working a day job
  • Gains in equity mean the value of the property rises every year
  • Real estate is a fairly stable investment that doesn't fluctuate as dramatically with the market
  • Physical asset
  • Can be used as a second home in a favorite vacation spot
  • Possible tax write-offs

Risks: 

  • Hassle of dealing with unruly tenants
  • Vacancy, HOA fees, maintenance, and other expenses can add up and eat into your profit
  • Income may not offset costs
  • It takes some capital to begin, either to buy the place outright or to obtain a mortgage loan, which often requires 20% down
  • It takes time to sell a property if you decide it's not for you

To decide whether investing in real estate is a good fit for you, do your research and plan your budget. Talk to a professional who knows first-hand about investment properties, such as Paul Herbert, who can guide you to have realistic expectations. You never know - real estate might be your niche!

Compiled using the following source(s): https://www.investopedia.com/articles/investing/090815/buying-your-first-investment-property-top-10-tips.asp