Business, property management, real estate

Investing in Single Family Homes

Note: If you are interested, this article lists some REIT investments in single family homes.


New Ways to Profit From Renting Out Single-Family Homes

Companies Offer Investment Options That Are Alternatives to Being a Landlord on Your Own

Sept. 19, 2014 2:21 p.m. ET

Many real-estate investors buy just one rental property. Associated Press

Two-and-a-half years into the U.S. housing recovery, the real-estate industry is rolling out new ways for individuals to invest in the property market.

Brokers, property managers and others are helping buyers purchase houses in distant cities and manage them as rentals for a fee. Publicly traded trusts that collect rental income are selling shares to investors. And crowdfunding startups are matching buyers with willing lenders.

The latest pitches generally aim to eliminate the day-to-day headaches of being a landlord, and the potential payoff can make the concept worth considering. Investors can buy in for the price of a single-family home or a single share of stock.

But the plunge in U.S. home prices in the financial crisis should be a fresh reminder that bets on housing can sour in a hurry.

The latest deals often don’t depend on home values going up, which sets them apart from the house-flipping strategies that cost many home buyers dearly when the market collapsed. Yet investors could still face losses if, for example, the economy weakens and renters can’t keep up with their payments.

Those who buy a rental property and then need their money back down the road could also get burned. Unlike stocks, bonds and mutual funds that can be sold quickly, it can take months to unload a house even in a strong market. And if prices decline, investors may lose a chunk of principal for good.

Despite the risks, investors worried about pricey stocks and meager bond yields can be lured by the prospect of a steady income stream and average annual returns that could range from 5% to 15%, if things go well.

Don’t go overboard. Investors should maintain a diversified portfolio that also includes stocks, bonds and cash. Single-family homes shouldn’t exceed 5% of their investments, not including their primary residence, says Jeff Sica, president of Sica Wealth Management in Morristown, N.J.

For the moment, the supply of rental homes and the demand from renters are high. Some 14.9 million single-family homes were occupied by renters in 2013, up 31% since 2006, before the U.S. housing market collapsed, according to data released this past week by the U.S. Census Bureau.

The vacancy rate on single-family rentals fell to 7.3% in the second quarter, down from 10% in the fourth quarter of 2008, according to the bureau.

Here’s what you need to know about making money in the rental market.

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apartment, landlord, property management, real estate

Soaring Rents

Longtime tenants get the boot from upgrades, soaring rents

Recent sales of older Seattle apartment buildings are displacing longtime tenants as the rent jumps to match modern apartment amenities.

Seattle Times business reporter

Average rents in region’s biggest cities

These were the asking monthly rents and annual increases for a 1-bedroom, 1-bath apartment in August, before landlord concessions.

Seattle: $1,484, up 8.6 %

Bellevue: $1,665, 6.9%

Kent: $886, 8.6%

Everett: $1,066, 9.2%

Renton: $1,087, 9.8%

Federal Way: $844, 5.2%

Kirkland: $1,374, 9.6%

Redmond: $1,457, 12%

Source: Apartment Insights Washington



@Accurate No empathy, what’s it like to live without a soul? MORE
@Accurate Median wealth in this country has fallen in recent years, 95% of all increased wealth has gone to the top 1… MORE
No sympathy here. Zero personal financial planning on the part of the tenants. There is a point in life where you must… MORE

From her terrace overlooking South Lake Union, Helen Goehring has watched construction cranes and new high-rises mushroom on the horizon in Seattle’s latest economic boom.

Goehring, 82, knew many city residents were facing steep rent hikes, forcing some to move.

This month she and about 200 fellow residents at the Panorama House apartment building on First Hill learned they too will join the ranks of the displaced. New owners plan to thoroughly renovate the 1962 building — meaning higher future rents — so residents must leave by early next year.

The Panorama’s sale comes as Seattle’s mayor and City Council seek ways to keep older market-rate apartments affordable.

In Seattle, September’s average apartment rent climbed 10.3 percent from a year ago, to $1,485, according to market research firm Dupre+Scott. The average apartment rent in King and Snohomish counties was $1,293, up 8.9 percent.

“The only way I could remain in the neighborhood is dramatically downsizing” from a two-bedroom unit to a studio,” Goehring said. “That’s really hard because it means letting go of my treasures — my antiques.”

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landlord, real estate

Access to room by crawling

Landlord rents room that can only be accessed by crawling

The room in North London was being rented to a couple for £420 a month despite having a staircase that measured as little as two feet and three inches in places.

The top floor bedroom in a house Hendon, North London, was being let to a couple for £420 a month

The top floor bedroom in a house Hendon, North London, was being let to a couple for £420 a month Photo: SWNS

A landlord who rented a room that could only be accessed by tenants by crawling on their hands and knees has been fined.

The top floor bedroom in a house Hendon, North London, was being let to a couple for £420 a month.

However, in order to get into the room, the couple had to make their way up a staircase that required them to squeeze through spaces just just two feet and three inches and three feet and 11 inches high.

Yaakov Marom was issued with a prohibition order banning him from letting the top floor bedroom after inspectors found it could only be entered by crawling up the stairs before passing through a small door.

Marom failed to comply with the order and officers from Barnet Council discovered he was letting the room.

The authority’s Environmental Health Team found the low ceiling above the staircase and small entrance hatch made it impossible for tenants to reach the room while standing upright.

Marom pleaded guilty to failure to comply with the prohibition order at Willesden Magistrates’ Court.

He was fined £1,500 fine and ordered to pay £1,420 in costs and a victim surcharge of £120.

The height along the course of the staircase was between 0.7m and 1.2m high (SWNS)

Councillor Tom Davey, chairman of the Housing Committee, said: “At the very least tenants have the right to expect that the accommodation they are renting is safe.

“Barnet Council is keen to work with landlords and help them to provide safe accommodation.

“However, those who exploit tenants for financial gain will not be tolerated and the appropriate action will be taken.”

Last year, Barnet Council investigated over 970 reports of poor conditions in the borough.