Advantages And Disadvantages Of Owning A Rental Property

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What are Shares
Shares and stock are the same thing and when you buy a certain amount of shares, you own a proportion of the company making you a shareholder. As the value of a company’s shares go up and down, the value of the shareholders investments so too. Usually you invest in the company because they offer a capital growth.

Purpose of Shares
Main reason to buy shares it to gain an income from the money the company makes but you do have to pay a certain amount to the company and may lose that money entirely. The main reason why you should sell shares from your company is that some of the money you get can be used to buy resources to make goods or provide services.

Buying Shares
Shares are traded electronically but can only be bought through an ASX
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Disadvantages of Owning a Rental Property
Tenant Risk
You can never be absolutely sure if the renters will pay their rent. Depending on who you rent it to, some may pay their rent on time every month whereas other may pay on a irregular basis or not even pay which makes things harder for you. Also while they are staying at the property, some renters may damage the property which may create a loss for you because you have to fix what has been done otherwise they can sue you for not fixing the damages. Another big risk, is that you may not even find a renter which means the property will be empty and not creating an income.
Active Involvement
With the property always being used, it will need constant repair which shall mean regular checkups, interacting with the renters and doing some kind of paper work. This can be done for you by a management company but that would mean less profit for you.
Selling Difficulties
Selling the property later may be difficult and costly with things like making repairs and cleaning up the house properly. It can also be costly to sell due to legal and real estate

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