Whether you understand all the ins and outs of real estate or not, there’s no denying the fact that it’s a profitable field to get into.
Like many investment platforms, there’s more than just one way to put money in and pull more out, which can make things a bit intimidating.
I’ve listed three of the most common moneymaking tactics in the world of real estate so you can see if you’re up for using them as a source of extra cashflow.
First things first, why is the real estate market so attractive to investors?
After all, it is a more in-depth investment in comparison to stocks…
Yet there’s been continuous popularity flowing into real estate, despite the market correction that took place in 2008.
One explanation is because sales prices of new homes have been at a consistent increase for the past 80-odd years!
Still, I believe credit is due to the accessibility that buying and selling homes has to offer. It’s one of the few investments that doesn’t require you to pay in full to reap the rewards.
In the stock market, investors have to pay every last penny to become a shareholder, but real estate only requires a 20%-25% down payment.
This ability to buy-in at a fraction of the cost is exactly what drives flippers and landlords to the market in the first place!
As I mentioned, real estate isn’t always the most hands-off approach to investing your finances…
Even though you only have to cough up 20 or so percent to get your foot through the door, there’s still a decent amount of capital involved to finance and cover maintenance.
For some people, the initial investment isn’t nearly as much of an issue as the constant upkeep that goes hand-in-hand with being a landlord.
But if you’re willing to deal with tenants and the handy work, then this type of real estate can act as a great source of income!
It’s simple. Rent out real estate to a tenant at a price that covers mortgage, taxes and maintenance costs and leave yourself with some additional profit.
Still, if this option is a bit too involved for you, a real estate investment group may be the way to go.
This is arguably the most passive form of real estate, considering it lets you own property without the responsibilities of a landlord.
Certain companies buy apartment complexes and sell individual units to investors. The thing is, the company manages all the units so you don’t have to!
In exchange, the company asks for a percentage of the monthly rent. Overall, it’s a much safer way to invest.
Finally, there’s flipping…
Although this is the most involved of the investment options I’ve listed, it’s quite possibly the most profitable.
Flipping homes presents an opportunity for investors to make FAST returns on real estate by turning homes for profits in as soon as 4 months!
If you play your cards right, you’ll have solid payouts a few times each year!
These investments are usually short and sweet, but they require a decent amount of knowledge on the subject, which basically boils down to being able to recognize undervalued properties that can be turned for profit.
As you can see, there’s more than just one way to make the most out of your real estate.
Renting out properties as a landlord, joining a real estate investment group and flipping homes are some of the best options when it comes to making money from the market.
Hopefully now you have a better understanding of what investment opportunities are out there and how you can get started if you choose to.