It's not covered by insurance. That's what security deposits are for. Being a property owner is expensive. So is becoming one. You'll need to make a larger down payment on rental property than you would if you were going to buy an owner-occupied building.
Interest rates are also higher on rental properties.
Many lenders charge a third to a half a point more than they would on a loan for an owner-occupied residence. There are also all the other costs associated with buying a house, such as inspections and appraisals. Huet adds that many property owners use that analysis to figure out how much rent they can charge. Some people get into the landlord business by buying a new home, and then renting out their old home instead of selling it. Another common way to get into the landlord business is to buy a duplex, triplex or four-plex and live in one unit while you rent out the rest of the building.