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Ok, I am not good with my hands. I don't have any desire to improve houses on my spare time. Is real estate still a good option for me? I also don't like dealing with people, especially strangers. Wouldn't I have to do the leg work of finding tenants, etc?

I can't say whether real estate is a good option for you or not. Basically, it depends on how quickly you want to see returns and what rate of return you're looking for.

I can tell you that there are management companies that will do these things that you don't like... for a fee. Paying the fee will probably mean that your property will not immediately cash flow, but you'll still reap the rewards from the tax benefits and appreciation. Eventually it should cash flow, too, once rents have increased sufficiently.

You may even find a fellow landlord (like me) who enjoys doing these things that you don't and might be willing to do an "equity participation" deal with you - basically, you put up the cash equity, they put up the sweat equity, and you agree in advance what percentage of the rewards each of you will be entitled to.

As far as the legwork of finding tenants goes, my experience has been that there's not much legwork at all. Finding houses requires a lot of legwork, but tenants can be convinced to come to you. When I had a unit to rent, I placed an ad and had open houses. This method was very successful for me. In a couple weeks I had a handful of qualified tenants and then faced the difficult decision of choosing one of them.

Then again, I've only had to rent one unit this way. The first unit rented by word of mouth before I'd even finished the renovations. The second one is the one I had the open house for. Except for a friend of mine who occupied the place while I was working on it, I've had the same tenants since I rented the place (about 3 months after I bought it), and they've shown no indications of a desire to move.

I think I'm pretty lucky - I like almost everything about being a landlord... except plumbing and roofing.

SS
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