Apartments for rent are again gaining the interest of real estate investors after about two years of negligible activity in the multifamily housing market.

Boston-based Bostonian Investment Group has started raising money to reach its goal of $100 million to launch an investment fund that will buy mortgages backed by delinquent multifamily buildings in North Texas.

Los Angeles-based multifamily investor Learning Links Centers has also started raising money to purchase about 3,500 apartment units in Dallas and Fort Worth in the next couple of years. Learning Links founders George Pino and Joe Killinger said they will buy around 1,200 units within a year and will raise between $30 and $40 million to buy apartment properties.

Another investor raring to acquire multifamily buildings in North Texas is Dallas-based commercial property investor J Alexander Realty Group Ltd., which has started raising funds to acquire smaller apartment buildings.

Bostonian Investment has been an aggressive investor in multifamily housing in Texas for years, buying many of its 5,200 apartment units in the state from 2006 through 2008. It stopped buying in 2008 when the housing market collapsed. So far this year, it has bought only the 284-unit Windmill Terrace Apartments in Bedford, which it acquired for $8 million.

Justin Meszaros, CEO of Bostonian, said his firm plans to buy older apartments for rent, renovate them and then increase the rents. He added he is looking for apartment complexes priced between $5 to $20 million and those that he can buy for 50 to 60 percent of the value of their notes.

According to Brian O’Boyle, manager of the Dallas unit of Apartment Realty Advisors, apartment deals in the Fort Worth and Dallas area rose to their peak in 2007 when a total of 211 apartment buildings were sold. Deals fell last year as only 105 apartment complexes were sold. This year, only 31 apartment buildings were sold so far. O’Boyle predicted increased deals this year and in the next years.

Investor Pino said that North Texas is a good location for apartment investments because of its pro-business climate, its strong job creation record and the relative stability of the multifamily housing market.

Charles Williams, head of commercial mortgage intermediary Pioneer Services LLC, also cited the attractive prospects of buying distressed apartments for rent in North Texas. He said that the pressure for banks to eliminate nonperforming assets will force them to sell distressed apartment properties at discounted prices.

House renting provides additional income but it also brings up problems that you need to solve or prevent from happening based on the experiences of other landlords.

Among the most common problems are those that arise from the rental conversion of a single-family house that was supposed to be occupied by the buyer. Before advertising your property as a rental, make sure your neighborhood or your association allows lease agreements. Make sure there are no zoning restrictions in your area.

Likewise, if you are converting your basement, attic or garage into a rental, make sure zoning codes and neighborhood laws allow your plan. Any extension or construction of a separate entry way for rental space should also comply with building codes in your area.

Oftentimes, neighbors complain if too many rentals depress their quality of life because of too many cars parked on the streets, too much noise or too many irregular extensions that destroy the overall appearance of the neighborhood.

Make sure everything you do in relation to your rental complies with your neighborhood laws, your city codes and your mortgage contract because oftentimes penalties or the consequences on your mortgage are costlier than what you expect to earn from your rental space.

House renting can also affect your home insurance. Consult your insurance agent if changes in your property will void your right to claims. You may be required to buy a policy for multifamily housing.

Another common problem faced by landlords arises from inadequate rental contracts or inability to implement the provisions of the contract. You may have specified penalties and fees for late payment of rents but you are not able to impose them because you are too kind or the tenant turns out to be the worst person you have ever met.

Just like other problems in life, the problem of a delinquent tenant is better prevented than solved. Spend time in screening tenants; do not accept the first one just because there are few people looking at your rental. Many landlords say that a vacant rental is better than a rental occupied by someone who not only refuses to pay but also refuses to leave and destroys your property.

Despite these potential problems of owning or managing rental properties, do not be discouraged. There have been many individual investors who have successfully earned income from house renting. Just research thoroughly, plan wisely and learn from the experiences of other landlords.

Renting for profit during the downturn is one option or investment opportunity that you can consider to weather the harsh effects of the recession.

If you are staying in a large house with several rooms or with a large basement, you can consider renting the extra space to someone you know or someone well recommended.

Since you may not be able to provide a separate entry and you are going to have some close contacts with the tenant, it is crucial that you know the tenant. It is not profitable or safe renting out space if there are risks to your safety, security and property.

If you are single, a young couple or siblings who own an apartment or condo unit, you can consider moving back to your parents’ home and rent out your unit. Of course, this option depends on your family situation, your level of need for personal space and your need for investment income. But this type of rental option has been done with positive results according to news reports online.

The typical renting for profit option is buying an apartment, a condo unit or a single-family house with the goal of renting it out. This option has been considered by a lot of people because of the significantly reduced prices of residential units available for sale.

The lower prices of foreclosure properties have also prompted a lot of people to consider buying a foreclosed home and then rent it out. Other factors like tax incentives, lower mortgage rates and financial incentives offered by some state governments are also enticing people to think of investing in the residential real estate sector.

But just like in other types of investments, you need to analyze and plan your funds, your cash flow and your ability to manage a rental before jumping into the rental investment bandwagon.

Among the first things you need to consider is your investment money. If you have saved a lot to be able to make a significant down payment on a property and you have been easily paying your monthly loan payment for your existing home and all your other monthly bills, you have a bigger percentage of success.

Consider also that there will be times that you will not receive rental income, that you will need to make repairs and that you will have to pay taxes, insurance and other bills. If you and your cash flow can manage these factors, then renting for profit is a wise investment decision for you.

Vacancy rates for both homes for rent and homes for sale have been increasing in many cities in the country, according to a study made by forbes.com.
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Landlords in Boston have been experiencing high vacancies as the number of apartment rentals increase across the city, even in higher-end neighborhoods.
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The economic recession has been continually hurting the country. Particularly, the housing industry has been experiencing the effects of the recession. Homeowners are not able to pay their home mortgages. This has extended to renters and landlords, who are also suffering the bad effects of the economy. The homes for rent market continued to crawl [...]

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New York City recently had rental homes prices increased. This is despite the pleas to freeze this action. One million stabilized apartments in New York now are expected to increase their rents, as officials approved rent increase. This is a first time in 40 years.
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