<prompt> Human: Now that I have my first home I started thinking about the next 5-10 years, whether or not I will keep this house and rent it out for supplemental income or just sell it. However my question is how do people actually make any notable money off the rent? Currently I have a 2200sq ft single family home and my mortgage is 1300month. Most rent around where I live averages around 1000-1500 so at best I could take in 200 month profit which is only 50week and that doesnt even include operating expenses and if something breaks etc. So how exactly do people make money in this regard? I feel like Im missing something in the equation  <response>: My family has been in real estate investing for more than 40 years. Between all of my family members, we have roughly 200 rental properties that are all managed by our family property management company in addition to another 1200 that we do not own personally. There are several points here1. Cash is king. If you can pay cash for an investment property, you have no mortagage to worry about. now, this may sound hard to do at first, but that leads me to my next point2. Buy low. Look for investment property that is just that, made for investment. If you cant do cash, then dont saddle yourself with a big mortgage. Look for properties that are in the 80-100k range and dont need much work. Make sure that the market can handle you renting a place like that out for a decent profit. Make sure that the place you buy for investment is low maintenance. For example, if there is carpet, replace that with tile or laminate flooring. It is expensive to clean the carpet during turnover. Paint the walls white, easy to cover spots. Make sure that you have a contingency fund for major repairs.3. Reinvest. Take the money you make every month and put it towards paying down the mortgage as fast as possible while still budgeting for major repairs. The faster you relieve yourself of the mortgage, the faster you will be able to make money. 