The Top 10 Real Estate Investment Strategies for Building Wealth

The approaches we list below vary widely in terms of cost, return on investment (ROT), time required, and

expertise required. The type of real estate investment you choose depends on several factors, such as your risk tolerance, desired

Properties for rent

Purchasing a rental property is one of the most popular real estate investment strategies. Whether you own a single-family home, duplex or multi-family building, rental properties are reliable, long-term investments that can provide you with a steady stream of passive income while you enjoy increased income.

Chop down houses

If you’re not ready to be a full-time homeowner, you might want to try housebreaking. By renting out parts of your main residence, such as a bedroom or basement, to a tenant, you can generate rental income to offset the cost of your mortgage payments. If you don’t want the hassle of long-term renters, sites like Airbnb can help you find short-term renters who are just passing through.

Return home

If you’ve spent any time watching HGTV, you’re probably familiar with real estate investing. At its most basic, investing simply means buying undervalued property and reselling it immediately at a higher price for a quick profit.

Real Estate Ownership (REO) and Foreclosure

When a homeowner defaults on their mortgage, it leads to foreclosure. This means that the mortgage company or financial institution repossesses the property and attempts to sell it at auction. If they do not find a buyer, the property becomes REO.

Real Estate Investment Trusts (REITs)

REITs are indirect real estate investments that allow new and experienced traders to gain market exposure without having to purchase their property. Like ETFs and mutual funds, REITs contain a basket of different assets, are traded on exchanges and pay regular dividends. They can be a good option if you don’t have a lot of money to invest and want to get into the real estate business.

When you buy shares of a REIT, you get a proportionate share of the income they produce. Different types of REITS invest in different assets, for example, equity REITs own real estate, while mortgage REITs own mortgages and mortgage-backed securities (MBS).

Real Estate Limited Partnerships (RELPs)

RELPs also offer investors a diversified portfolio of real estate assets. But unlike RETTS, RELPS is a private equity investment, which means they are not traded on public exchanges. PLRs also don’t tend to pay regular dividends. Rather, they are meant to be short-term investment instruments that earn a lump sum once their term is reached. Once the project is finished, the company is dissolved.

Real estate investment groups (GIF)

An REIG is typically a group with several partners who invest in and manage one or more apartment or condominium complexes. To join a group, you buy an apartment or condo through the company, which then hires a property manager to handle maintenance, interview tenants, and fill vacancies,

Although this investment option costs significantly more upfront than REITs and PLRS, it can be perfect for investors who want to own and rent their property without the hands-on experience of maintaining it.

Online investment platforms

Online lending platforms, also known as real estate crowdfunding, connect individual investors with real estate developers who need to raise capital for various development projects. Instead of financing their projects through a bank, developers sell stakes and offer monthly or quarterly distributions to investors online. To invest, you can often open an account with a minimum deposit of as little as $500.

Home building companies

Another indirect way to invest in real estate is to buy shares in home-building companies, As the real estate market continues to grow, companies like Lennar (LEN) and D.R. Horton (DHI) constantly develop new

Commercial property

higher than that of residential units and comes mainly from rent. However, some tenants also purchase

options for what is called the “right of first refusal (ROFR) in neighbouring properties

developments to meet the growing demand. Commercial properties, such as commercial, office, warehouse or industrial buildings, offer experienced property investors a higher return than residential property. Income from commercial property is generally

However, making money in commercial real estate requires knowledge of zoning, building codes and specialized lease agreements

Find the best real estate investment strategy for you

Real estate is not a single type of investment. Where you choose to put your money depends on your financial goals.

And remember nothing says you have to choose only one type of investment. Diversifying your real estate portfolio is a great way to find what works best for you while protecting yourself from potential losses in one area.

 

The bottom line

Land putting should be possible in different ways. Whether you’re saving to buy your own home, investing in a rental property, or buying stock in an online crowdfunding company, always make sure you do your research to

get the most out of the option you have