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There are many ways that you can use your money to help generate a positive return, but individuals will frequently limit their consideration of potential investments to traditional stocks and bonds. Real estate can be a highly effective way of achieving positive returns on your money, but a lack of awareness can lead to believing myths about this type of investment.

Myth: Investment Real Estate Properties Only Generate Gains Through Appreciation

Individuals will frequently assume that the only way to generate a return on real estate is for the property to appreciate in value. While this can be one of the main ways that these properties can generate returns, it is also possible for individuals to rent these properties, which can provide a stable source of income along with the returns from the appreciation of the property's value.

Myth: It Will Be More Difficult To Obtain Financing For Investment Properties

Financing a major real estate purchase can be essential if you are to be able to make this transaction. Yet, there are many individuals that will simply avoid considering this type of purchase due to the assumption that they will be unable to obtain financing for this purchase due to the belief that it will have much stricter requirements for being approved.

However, it is important to note that obtaining financing for an investment property will be essentially the same as obtaining the financing for a residential property. Interestingly, there may actually be some advantages that you can utilize that may not be available to those that will be financing a traditional home. For example, if you will be renting these properties, you may be able to include the projected income for the property on your application for financing. There will be stipulations for using this option on your application for investment real estate loans as the lender will need to verify the estimates to ensure that they are reasonable.

Myth: Maintaining Investment Properties Will Be Very Laborious and Time-Consuming

Any type of real estate property will require at least a basic level of maintenance to keep it in good condition. This is particularly true for properties that will be rented out to tenants as there can be legal liabilities involved with failing to adequately maintain these properties.

For those that are concerned about the work that will be required to care for the properties, there are many services that will handle basic maintenance and oversight for these properties. These services will include making basic repairs to the property when tenants report them, screening applicants, processing rent payments and handling evictions.