3 Smart Real Estate Investment Strategies

There are many different ways one can invest in real estate such as long-term rentals, vacations rentals, short-term rentals, fix and flips, long-range investing, non-performing loans, wholesaling and even purchasing a personal residence. Potential investors are literally spoilt for choice.

These are the best ways to invest in real estate because they offer great profits that carry on paying you as long as you own the assets.

Real estate investments have become increasingly prevalent over the years but although the real estate market presents a lot of opportunities, purchasing and possessing real estate could be very complicated. Each method of investing in real estate has a different level of jeopardy, returns and time commitment. Some real estate investment tools are more like full-time jobs than an investment, while some investments like REITs (Real Estate Investment Trust)take almost no work. Here are some of the best ways to invest in real estate in no actual order:

#1. Rental Properties

You could decide to invest in real estate by purchasing some property and then renting it out at profitable rates. You will be responsible for paying the relevant taxes and associated costs of maintaining the property so you will have to make rent prices high enough to cover all the aforementioned costs.

#2. Real Estate Investment Trust (REIT)

REIT is purchased like mutual funds and are extremely large funds that invest in real estate and then pass on dividends and profits to the shareholders. REIT’s invest more in large commercial projects, land, industrial buildings or even government buildings than in other types of real estate. Real estate investment trusts are the easiest way to invest in as they handle all the management of the real estate investment. The incomes may be excessive, but can also go up and down like the stock market. You also can’t buy a REIT below market value like you can a house.

#3. Real Estate Trading

When it comes to real estate investment, this is the wild side. Real estate traders purchase assets with the sole purpose of holding them for a short period of time, whereas they hope to sell the properties for a profit. This is also called flipping properties and is based on buying properties that are very hot in the market.

Flipping is a great way to invest in real estate, but it takes lots of work. You’ll have to manage contractors, keep track of accounts, find deals and get homes sold. It can also take lots of money for down payments and repairs.

Conclusion

There are several means of making money by investing in real estate. Some favor long-term rentals because they can provide cash flow monthly, year after year. Fix and flips can provide tremendous revenue, but you must keep a great capacity of deals going and turn them speedily to make lots of money. Vacation rentals, long distance investing and non performing notes can also be great investment options for you if you take the time to make the right inquiries.