What Are the Benefits of Co-Owning a Rental?
There are many reasons to co-own a rental. For example, you may purchase a home with a spouse or partner, a sibling, a trusted business partner, or someone else you trust. There are also cases where you may have inherited a property along with others.
Here are some of the key reasons co-owning a rental might make sense for you:
- You can divide the rental management tasks: This is especially helpful when one or both of you are part-time landlords and have busy, full-time responsibilities. Perhaps your tenant needs to meet you and you are on a business trip. In this instance, your co-owner can fill in while you are out of town. Likewise, when there are maintenance issues or other matters, you can split up the responsibilities. Many times, one of the co-owners is stronger in finance and accounting and they may be responsible for record keeping and managing cash flow.
Co-owning a rental property also has the added benefit of companionship, so you don’t feel like you have to handle everything by yourself.
- The ability to pool more financial resources: With the help of a co-owner, you can access a more expensive property, buy more property, spend more improving a particular property, etc. For example, you might be eyeing a fourplex that has great rental yield, but perhaps you can’t afford it on your own. By purchasing the property with a co-owner, you can increase your buying power and your options for selecting a rental for purchase.
While there are many good reasons to share ownership, it’s not for everyone. In fact, some landlords believe co-ownership has significant drawbacks.
- How Can You Effectively Get Information From the Current Owner?
- How Long Does It Take to Buy a Home?
- Should You Arrange a Professional Inspection Before Buying a Property?
- What Should You Do When Buying a Currently Occupied Rental?
- Should You Buy a Foreclosed Property?
- Should You Buy a Single-Family Home, Duplex, Triplex, Fourplex, or a Condo?
- What Are the Disadvantages of Having a Co-Owner?