If you have been looking at investing in real estate then you first need to decide how you will go about it. There are many ways in which you can make money from real estate investment and in order to provide you with more information we have brought in real estate expert Ali Ata to help you understand some of the most common ways in which people invest in real estate, and to what end.
This is a great way to invest your money, it is far more secure and stable than stocks and shares and it is a tangible investment which can make you some serious profit. Let’s take a look at some of the options available to you.
The idea of flipping houses is to buy a property for low price and sell it on quickly for a small profit. In doing this you can ensure that you don’t have your money tied up in a place for too long, and you can quickly move onto the next opportunity. Those who flip properties usually buy dilapidated properties or those which need a little TLC from auctions, they will then invest some money into the property to get it in better shape and then they will sell it as quickly as they possibly can.
Probably the most common form of real estate investment is those who are doing it for the long term and will look to rent out the property for a large period of time. The benefit of doing this is that whilst you will have a lot of money tied up in your asset, you will be receiving money each month from the rent. This option gives investors the chance to wait until the market is looking strong before selling and in many cases the monthly rental can pay off the value of the asset, which gives the investor a 100% profit option when they eventually sell the property. Rental prices don’t chop and change like the buyers market which means that very often the rental price will bring in more money than if you were to buy and sell the property quickly, essentially it offers protection when the market is low.
Using a Private Equity Fund
Private equity funds pool resources and use them to invest in multiple properties or large scale properties such as office buildings and malls. Many investors like to use these vehicles for a number of reasons, mainly because it gives them far more spending power. Another reason why investors like to use these private funds is because those who work there are often experts in the real estate market and that means that they can make much more money when they do things in this way, than if they were to go it alone.
The choice will come down to how much you are looking to make and in what space of time you are looking to make it.