Many financial experts are of the opinion, that as an investment, real estate has made people more wealthy than any other investment. However, even to this day, there are many misconceptions surrounding real estate investments.
Many people state that unless you have a large capital to invest, you cannot enter real estate. The second misconception relates to real estate only offering long-term opportunities, which makes it untenable to small investors.
In this article, we are going to look at five proven ways to make money with real estate investing. However, before we do that, let us first look at what are some advantages of real estate investing.
Major Advantages of Investing in the Real Estate Sector
For a very long time, real estate has been a favorite among investors. This is because, in terms of growth and income, real estate has been able to offer investors higher returns than other sources of investment.
Here are some of the other advantages of investing in real estate:
- Most national governments offer heavy tax benefits when you invest in real estate.
- Investing in real estate helps gain long term financial security for the future.
- Real estate has been proven to be a great hedge against rises in inflation.
- The cash flow is steady and guaranteed especially if you are into renting.
- Real estate opens up a lucrative second source of income with small investments.
In addition to the above, real estate investing is always about being your own boss and ensuring financial security and independence for investors.
List of 5 Proven Ways to Make Money with Real Estate Investing
1. Wholesaling Real Estate-
A new phenomenon has arisen in real estate investing in recent years called wholesaling real estate. In this process, real estate investors search for distressed properties and get them from the original occupants at a lower price than the market rate. He then proceeds to offer the same to an interested buyer at a higher price and keep the price difference as profit.
The most traditional and safest way to earn a regular income from real estate is through renting. For example, renting can allow you to pay for your investment loans if you have taken the same from a bank. It can also allow you to own the property within a small period of time. Renting is also a great way to always keep the property fresh and in the know-how of the market.
Many real estate investors are now looking at flipping to make quick returns on their investments. Flipping involves finding a not so decent property and sprucing it up with redesign and redecoration. The property is then put on the market and commands a much higher premium than it would have in the previously run-down condition.
Leasing is a great real estate opportunity especially for investors who work in commercial real estate. Leasing is better as it allows you to fix down on a client for a higher rent and a longer period. Car showrooms, internet companies all look out for leasing opportunities as it is more affordable and convenient for them.
5. Aggregator Listings-
Many real estate investors are now exploring opportunities as hotels and guest houses and vacation homes. This has been brought about by the coming of startups who are willing to take over the properties and pay the investor a fixed amount every month. This has opened up an entirely new and lucrative earning opportunity for real estate investors.
The Final Word
Real estate is never going to go out of fashion because it is always in limited supply. As economies continue to grow and the world’s population keeps increasing, real estate too will continue to rise in value and demand.