You need the right start if you want to make money in real estate. Starting with the right capital is also key. There are very reliable options you have, but you need to establish a price range. Be sure to save at your own pace. Real estate investing is scalable, so you can increase your holdings over time. Starting with a single property is ideal. In the end, your strategy is to profit, and this means finding a suitable balance between risk and reward.
With a Primary Residence
Starting your real estate investment by purchasing a personal residence gives you options. You’ll not only have a place to call home, but its equity is likely to rise each year. With a primary residence, you get a usable address, rooms to rent, and a chance to build experience as a property owner. Owning real estate takes more than having money to purchase a home. Maintaining insurance, utilities, and living conditions call for ongoing investments made by you.
The Single-Family Rental
Investment properties are those that generate an income. Real estate income is generated by renting space for residential use or commercial businesses. Like the property you buy as a home, rental properties will also appreciate it. This appreciation, however, is only beneficial if or when you want to sell your property. A reliable strategy is to hold real estate for at least five to seven years before selling it. As for family rentals, you get to make numerous tax deductions.
Lower Risk With a REIT
Keep in mind that you don’t have to take on the full liabilities of investing all alone. Through real estate investment trusts (REITs), you can buy a stake into a proven portfolio. A REIT’s portfolio can consist of any type of property, which is generally managed, bought, and sold by the trust. The better the reputation of the trust, the less you’ll have to concern yourself with as a stakeholder. You won’t directly have to answer calls for leaks or when getting new tenants.