Real estate investment can be a lucrative investment to get involved in. By investing in real estate, you have the power to control the property you buy the moment the papers are signed. With as little as a 5% downpayment, you could, in turn, take out a second mortgage to make downpayments on additional properties, and continue this cycle of give-and-take as you expand your ownership outward.
While all of that is said and good on paper, how to earn money on the properties you’ve invested in isn’t exactly written down in some handy manual. How can you invest in real estate? Here are a few simple ways to do so.
Become a Landlord
This is one of the easiest and most common ways to make the most out of your investment. Though it’ll require a fair amount of money to finance the property up-front and cover the months that the property remains uninhabited, you’ll more than earn back that money once tenants move into the property through rent. Rent provides a regular income to landlords while maximizing on leveraged capital. Ideally, the property will appreciate over time, making it more valuable than when you initially bought it.
Get Involved in Real Estate Investment Groups (REIGs)
For people who want to invest in real estate but don’t want to worry about running the property themselves, this is the way to go. The properties available through REIGs are bought by investment groups and sold through them, letting investors join the group once they buy any number of properties. Though the company will take a portion of the monthly rent, you’ll still earn money from the property whether or not it’s vacant or otherwise.
Become a House Flipper
Several TV shows have been made involving house flipping, making it the second most known method of real estate investment on this list. Ideally, this investment method is for people who have experience in real estate valuation and marketing, as well as renovation. Depending on marketing conditions, the returns from flipped properties can be significant.