Renting homes for profit can be quite lucrative. 

If you can find the right property at the right price and get a favorable interest rate, renting makes a lot of sense.  Essentially you’ll be having a tenant pay off your mortgage for you and perhaps have a little profit left over.  There are things to consider such as the home being vacant between tenants and repairs.  It is also good to collect a security deposit from tenants in case damage is done to the home,.  If you don’t want to deal with midnight calls to deal with a leaky faucet or broken heater, you might want to consider hiring a property manager to take care of the hassles like collecting rent each month, and scheduling needed repairs. 

The trend in home prices typically rises over time, so if you purchase a home low and have patience it could pay off nicely a few years down the road, all the while tenants are paying down your mortgage for you.  It’s also a situation where you can potentially recoup a significant profit.  If you put 10%  down on a property, and rent it and just cover your costs, and the property appreciates just 10%, that’s a 100% return on your initial investment!   Other people will purchase a property for their kids with very little down.  They let the rental income pay off the property and by the time the kids are old enough to head to college, they tap that equity and pay for college that way, and repeat the process of having someone pay off the house again! 

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