As the famous Robert Kiyosaki said, “Assets put money in your pocket, while liabilities take money out of it”. By this surely rental properties that give you a positive cash flow are assets. The rental you receive must be greater than your morgage, taxes, maintenance and expenses. A positive cash flow is easier to achieve if your have capital.

The rule is, it is easier to generate a positive cash flow when the property is fully paid up. But how do you create a passive income system? The answer is the rental income has to be more than the monthly mortgage installment. The first key is to get a good price by buying a property below the market value. Also, it must be a completed property in an area that is at least 90% occupied, so that it increases your chances of getting tenants. Also try to consider medium-cost apartments, which are normally cheaper and gives higher rental yield. Another tip, for a better chance to obtain positive cash flow from your rental activities, get a longer-term loan.

However, always examine the bigger picture and ensure that your borrowing costs do not exceed your returns. And do be prepared for times when the property is left vacant and you will have to bear the monthly payment yourself.

Guys, if buying property and making passive income via rental is not your game or cup of tea, stay tune for the passive income 2.

Stay tune.

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