A lot of hard work goes into getting your rental property up and running. There’s no greater feeling than seeing all that hard work come to fruition, receiving that first rent payment, and seeing the returns on your investment. But once they see that first payment, many investors wonder what to do with the remaining profits. While you can use it for personal benefits and purchases, you can also reinvest that money. If you’re interested in making more returns, let’s take a look at a few great ways to reinvest real estate cash flow.
Give Your Property a Makeover
Putting cash flow back into your property is one of the fastest ways to increase returns. You can do so by upgrading amenities, adding extra space, remodeling a room, or improving the property however you see fit. Most tenants are willing to pay extra for amenities that benefit them, so you can charge more rent in return. This is also helpful if you plan on selling your rental in the future. By investing more into it now, you can sell it for a higher price later when there are more buyers in the market.
Invest in REITs
If you want to diversify your portfolio but don’t want to invest in another property, you can reinvest your real estate cash flow into a real estate investment trust (REIT). REITs are essentially companies that finance, own, and or operate income-producing real estate. Similar to stocks, you can buy a share of their investments to receive some of their returns. With this method, it’s safe and easy to diversify your portfolio with a myriad of properties and property types—and you don’t have to manage any of them.
Diversify Your Portfolio
You can also use that cash flow to put a downpayment on another property. This allows you to diversify your portfolio and spread out your money so you don’t have to rely on one rental for income. You can double your returns by buying a new property or investing in a fix-and-flip. By fixing and flipping a property, you can make faster returns, but investing in another rental gives you more security in case things go awry.
Ready to reinvest in other properties? Don’t get bogged down by all the responsibilities of managing multiple rentals. If you’re looking for rental property management in Atlanta, let Excalibur Homes take some of the weight and responsibility of being a landlord off your shoulders.