In recent years, buying property to rent out has been a popular investment strategy, especially in high-demand real estate markets such as Portugal.
But is buying an apartment to rent out really a good investment? This article explores the advantages and disadvantages of this strategy, as well as the factors to consider before making this decision.
Steady passive income.
The main advantage of purchasing a property to rent out is the possibility of obtaining a stable passive income.
When a property is rented out, the owner (landlord) receives a monthly rent from the tenants. In other words, once the contract is established, the rent becomes a source of passive income, which offers several advantages, namely the creation of continuous and predictable income, without requiring constant active involvement.
After signing the contract, the landlord can devote little time to managing the property, or even delegate this task to third parties, thus allowing them financial freedom and time to focus on other activities.
This type of income provides stability, regardless of unforeseen circumstances such as illness or inability to work, and allows for the creation of multiple sources of income, reducing dependence on a single active income, such as a salary.
Long-term property appreciation.
Long-term property appreciation is one of the main benefits of buying an apartment to rent out.
Over time, property values tend to increase due to growth in urbanization, tourism, and improvements in local infrastructure. This allows the owner to generate passive income through rent and see their investment grow in value.
In Portugal, the real estate market has been consistently appreciating, making renting an attractive strategy for those looking to accumulate wealth and improve their financial capacity, especially in areas with high demand for housing.
In the future, the sale of the property may result in a considerable profit, maximizing the return on the initial investment.
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Source: https://blog.iadportugal.pt/