Real estate investment options guide for profitable investing
First off, let me start by saying that whilst real estate investing is very lucrative – it is not exactly meant for everyone at any given point in time. There are instances where investing in real estate will not be in your best interest and that will be a fact that you must accept. This article will focus on the 4 real estate investment options available to beginners.
But that aside, real estate investing is a great way to build great fortunes, and sustainably too.
However, to get started or build upon it, you must decide where you want to begin or end your journey into this lucrative field.
Makes sense? Now, let’s dig into the meat
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Once you’ve begun your real estate investment career it is a good idea to utilize more than one type of investment for the sake of diversity and spreading the risks – this is a volatile market at best. (so play it safer)
Noting that there are all kinds of avenues available to those who are considering real estate as a likely method of investing in the future – this is where your decision on what your choices will become into play.
And why on earth shouldn’t you be investing in real estate?
Real estate investing is one way that millionaires around the world will agree they have been able to build a massive fortune quickly.
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But note this – at the same time, real estate can be very profitable; it can also be a very risky venture for business so you might need to have a few more stable methods of bringing in money in order to have a truly diverse portfolio and a better security system for your financial future.
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And if you don’t want to venture outside of the real estate ecosystem then you will find different manners of investing that each bears different risks that you can explore.
Below are the 4 real estate investment options for beginners:
1. COMMERCIAL REAL ESTATE: This is a good place to begin because it is relatively secure when compared to some of the other forms of real estate investing. The drawback with commercial real estate is that it requires a massive investment, to begin with.
This area is something that many real estate investors do not even consider until they have built a sizable portfolio and have plenty of money to risk. It is mostly stable because businesses that lease from you will most likely want to lease on a long-term basis. This means that when you get clients (and treat them right), businesses prefer to stay in one location as long as possible because it’s good for business administration and stability in most cases to constantly be on the move, so they tend to stay awhile.
2. RESIDENTIAL RENTAL PROPERTIES: Becoming a landlord, which is not as glitzy as owning business properties throughout the city, building, buying and/or renovating fabulous properties for instant profits is a great way to work yourself into a rather comfortable retirement. This is a long-term type of real estate investment but the payoffs can be rewarding when all is said and done.
For the cautious real estate investor, this could be your type of real estate investment to pursue.
3. PRE-CONSTRUCTION REAL ESTATE: Pre-construction real estate (better known here as off-plans) are even riskier than house flipping in many instances, particularly as it has become so popular in recent years. The trick with this kind of investment is finding the right property in the right market that can/will appreciate initially as much as it can; in as short a period as possible.
One tactic for success is dependent on if you can get this in a city that is about to have a serious housing shortage or is in the beginning stages of a housing shortage (quite like Lagos and Nigeria has) then you stand to make quite a fortune for yourself.
The problem/risk to note with this is that this field is highly speculative and very competitive.
4. GENTRIFICATION: One of the real estate investment options is Gentrification, which is becoming a popular form of real estate investing as many people have discovered that this is also a great way to make money very quickly. This is a high-risk venture, to say the least, but the rewards are equally high and mostly tend to pay off because they are already in populated areas with an existing network of infrastructure and living utilities.
To do this successfully, you will have to decide if you are willing to take the gamble, as this is both capital intensive and notably are part-skill and part luck plus a lot of commitment.
So there you have the 4 real estate investment options explained to you in detail. Being an investor can be a full-time business and thus it’s best that you not only understand what is possible but what is also tenable as a risk to your investments and efforts.
Is there a form of real estate investment that you are more inclined to do?
Feel free to share in the comments section, I would really love to hear and know how I might be of service and support to your real estate investment journey.
This article serves as my one year anniversary of contributing articles to this platform and I would really love to step it up for you a bit. So if you have suggestions of what you want/need on this real estate journey, do share via email here.
Thank you for reading till now, to another year it is!!
Your Realtor and Ally for Wealth Creation, Lerato