Real estate investments go far beyond the typical landlord position. Actually, real estate investments continue to catch the eyes of investors and have become increasingly popular over the last sixty years. However, like any market, the opportunities for profitable gains and large returns are there for the taking, but it’s much more complicated than people make them out to be. Here are some examples of the more “popular” real estate investments.
This basic, and most commonly known, form of real estate investment involves a homeowner renting out their property to a tenant. The owner is accountable for the mortgage, taxes, and costs of the property. Typically, a landlord will charge a tenant an amount that will cover these costs. To make a profit, one could simply raise the rent – although most wait until the mortgage gets paid off, at which time the rent becomes largely profitable. Additionally, the property has the potential to appreciate in value over time, leaving the landlord with a valuable asset that they can either sell or further develop.
Similar to day traders in that these investors hold on to real estate for a short amount of time and then sell them when the time is right. There are two types of property flippers and each of them has their own money-making method. The first type of flipper will not put any money into the house for improvements relying solely on the intrinsic value of the home. The second type of property flipper adds value to the house by renovating it to significantly improve the value. There is no right or wrong way when it comes to flipping properties. Each method has its own positives and negatives but usually the outcome is reliant upon the property itself.
Bio: Kuba Jewgieniew is the CEO of Realty ONE Group, a real estate firm that has made INC. 500’s list of fastest growing companies in America for the 6th consecutive year, and was ranked top 10 in the nation for closed transactions by Real Trends.