Where do I start? The simple answer is to sit down with your Clockwork agent and map all of this out together. But here are some pointers for the DIYers.
Determine your why
Example: I want to use the income from a rental house to help pay for my kid's (or grandkid's) college tuition.
Set your goal
Example: By the end of this year, I want to purchase a property that I can pay off in 15 years and that will generate $1,200/month once it is paid off.
Learn to analyze properties according to your goal
This is where the fun begins! There are many tools out there to help you analyze rental property scenarios. But first, you will need to be familiar with various buyer and rental markets to determine where you want to buy. You will also need to research tax rates, insurance rates, interest rates, repair costs, and how much you can afford to borrow.
Line up your funds
Will you pay cash, use a mortgage, or involve another investor? Be sure to find a mortgage broker that has knowledge of your area as well as experience working with investors.
Hire a Buyer’s agent
Once you have decided that you want to pursue a rental property it's important to engage an Agent that has experience with investment properties. An investor has a different set of criteria than someone shopping for a primary residence. An experienced investor agent can help you ask the right questions and help you determine which property will most likely move you toward your goals.
Purchase the property
Here again, your experienced investor agent can walk you through this process.
Manage the property efficiently to maximize returns
Managing the property includes repairing and preparing the house to be marketed, finding and screening perspective tenants, choosing the best tenant for your property, collecting rent, routine maintenance, staying in compliance with Fair Housing codes, turning the property over from tenant to tenant. Some people enjoy managing this process themselves while others prefer to hire a Property Manager.