The world of real estate investing is forever growing and changing. One type of investment that is quickly becoming more common in the real estate sector is NNN lease properties or triple net lease properties. These properties are those that are already under lease with a tenant. And on top of paying for rent, the tenant also covers the cost of real estate taxes, insurance, and building maintenance—as specified in the lease. NNN lease properties are not the right investment for everyone, but they are a really great choice for many investors for the following reasons.
1. They're a hands-off investment.
A lot of real estate investing is quite active. For example, if you own a typical apartment building, you have to maintain the building and yard, keep up with the insurance company, and pay taxes. With an NNN lease property, your involvement is a lot more passive. Of course, you have to buy the property and collect rent from the tenant, but you don't have to do any maintenance, shop for insurance, or even keep track of the property taxes. Because NNN lease properties are so low-involvement, you can accumulate more of them in your portfolio without becoming overwhelmed.
2. The leases tend to be long.
NNN leases are hardly ever for 1–2 years like your typical apartment lease. It's more common to see them lasting 10 years, if not 15 or 20. Usually, these leases are held by large companies like chain restaurants or stores. So, you really don't have to worry about finding a new tenant every few years, or about marketing the property to new tenants. Plus, once a tenant has cared for and paid property taxes on a certain property for 10 years or so, they feel more connected to the space and are pretty likely to renew their lease.
3. The income is steady.
Tenants do not get into NNN leases unless they are quite confident in their ability to pay. As mentioned above, these leases are typically held by large, established corporations. As such, the rental income from NNN lease properties tends to be steady. You won't have to chase down tenants for the rent each month or worry about someone shorting you.
There are many different benefits of buying NNN lease properties. If you think this could be a good investment for you, talk to your real estate agent or visit websites like Netleasefinder.com to learn more.