Reported by the American Association of Realtors, the average U S citizens invest 7 houses throughout their life. Personally, those are 7 houses that we should hold onto for the rest of our lives, to come up with monthly revenue and long-term financial security for our families.

The usual process that we follow is to market the home that we live in and to utilize the cash from the sale to purchase a new house. What I advise is to apply the latest process. If we tweak the old practice just a bit, it may end up in a tremendous change in our net value and our financial security.

I propose that besides selling your home, just refinance it, and employ the money from the refinance being an installment on your next house. Now, you have two houses and you can just turn your old home right into a rental house. It’s almost as simple as 1 2 3.

The 3 steps to turn your home into a rental house

1.) Refinance your residence.

2.) Make use of the refinance money as a down payment to purchase a brand new house.

3.) Move into the new house and rent out the old house.

Both immediate benefits of turning your home into a rental house

1. You have the most current source of income flowing in, in the form of rental checks. These proceeds presents a new layer of security as it will not rely upon you working regular hours, but it continues to pour even though you lose your regular employment.

2. Formerly, you had just one house, which was increasing in value an average of 5% each year. For example, a $200,000 house would increase in value to $300,000 over 10 years, for a return of $100,000. When you own two houses, your revenue would increase to $200,000 in ten years.

Like having an additional retirement fund without retiring – only better!

Having rental houses far exceeds the good thing about the pension that you may receive from your job. I worked for the state of Arizona for 13 years, and I will someday get a retirement fund of around $1,000 a month. But guess what? Each year the value of my retirement fund will go down because it just isn’t fixed to inflation. So, after 10 years, I’ll still receive $1,000 a month but by reason of inflation, it might be actually only worth $100 dollars a month because the money necessary my groceries, my clothes, health care, and other costs have all gone up each year.

Rental houses provide a better pension. If I buy $1,000 a month in rent gains, it not just keeps up with inflation, nonetheless it surpass inflation. Which pension program would your rather have? One, which increases in value with all the passing years, or one that diminishing in cost?

Why didn’t I turn my home into a rental house a long time ago?

Even though you purchase just single rental property for the course of your whole life, your economic picture will quickly get better. You will ponder, as I did, “why didn’t I do this a long time ago?

Another great article by Toronto Condominiums Free reprint avaialable from: Converting Your House Into A Rental Property.