4 Ways To Start Making Real Estate Investments
Real estate is one of the most reliable ways to earn a return on your money. However, getting started with real estate investments can be daunting, especially if you don’t know what you are doing. It can seem like you need a lot of capital and take on a lot of risks. If you make the wrong moves, this can be true. However, there are several ways to get started even if you are risk-averse or low on capital.
1) Long-Term Rent
Perhaps the most reliable way to earn money through real estate is with long-term rents. This is when you buy a building and rent it out. You may own a single unit that you rent out or multiple buildings with numerous tenants.
Getting started on this take quite a bit of capital. However, if you have good credit, you can likely finance your real estate purchases. As long as you can keep your space rented out, you will be in very good shape. This is a good option for people who are risk-averse with a reasonable amount of capital.
2) Flipping Houses
A slightly riskier but very accessible way to earn money is by flipping houses. In this setup, you buy a house that requires work, improve it then sell it again. The majority of the return comes from the improvements to the house.
You may be able to finance this investment with a fix-and-flip loan. This will provide you with money to buy the house and improve it.
This type of investment has a higher risk but can have very high returns. If you get the location right, the risk is minimal.
3) Real Estate Investment Trusts
Corporations or trusts sometimes invite investors to help them with real estate purchases. In this setup, you would receive dividends as the primary return. Additionally, you can trade your ownership of the trust in exchange. If the trust is dissolved and the assets sold off, the investors also receive payments through that.
4) Real Estate Investment Groups
In this arrangement, several investors pool money in a group. The group is managed by a professional real estate investment manager. Due to this, each individual’s risk is mitigated because the portfolio can be diversified.
This is subject to the same risks as a mutual fund. In other words, finding the right manager is essential to success.
Learn more about real estate investments today. When you know the different vehicles, you can find the right option for you.
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