If you are trying to build up your portfolio and are looking for a potential constant positive return, consider investing in real estate. You can diversify your investments and insulate your portfolio from recessions or other adverse economic circumstances with this simple expansion of your holdings. While you are looking for quality investments, try these options to experience the best ways to find different real estate properties.
1. Vacation Rentals
If you want an easy way to invest in real estate, Taylor Equities suggests trying the second home vacation route. With the popularity of vacationing in homes instead of hotels, it can be easy to rent a well-situated property for almost every week of the busy season of that area. If the property is near a popular ski resort, expect vacancies during the summer, while if the house is close to a tourist destination, you will rent the property all summer long. Consider hiring a property management team to manage the property, but you can expect to pay up to 25% of the rental charges to cover management fees.
2. Fix To Flip
Popular television shows have glorified the house flipping process, but there is money to be made in this type of real estate investment if you find the right property, invest very little, and sell it quickly. In order to make enough off the house to make it worth your while, leave the process to professionals instead of doing the work yourself. Also, understand that purchase price, total repair costs, and holding expenses should not be over 65% of your expected selling price to ensure you make money on the project.
Apartment buildings or multi-family homes are one of the most popular real estate investments and have been for over a hundred years. Steven Taylor says people need homes, and research shows that Gen Z individuals would rather live in an apartment than in a home they have to maintain. That means there are 65 million people ready and willing to rent one of your multi-rental units. Remember to take property management and constant repair costs into account when deciding on a building to invest in.
4. Buy Into REITs
A real estate investment trust is a great way to get your foot into the door as a new investor. A company or trust gathers many investors together and uses all the money to purchase an expensive investment building that would have otherwise been out of reach. The company may have many different properties, but they often specialize in one type of investment. This could be warehouses, apartment complexes, infrastructures, or storage units. REITs can offer a steady income but may not provide capital appreciation.
If you are looking into investing in real estate, make sure you understand all the options available with all the positive and negative possibilities associated with each type. You can easily diversify your portfolio with a few safe purchases – all you have to do is know what you want and where you want it to be located.