When you buy something, you need to be very careful because you are investing your money on it. Think about how much careful you should be while buying a property? You invest a large part or almost all of your savings when you buy a property. Many times people take huge debts to buy a real estate that can take years to pay off.
The markets since the great recession have been little shaky and have only begun to improve in the last couple of years. The recession led to huge losses to the personal assets of the poor more than that of the rich. This led to lower consumption of goods which made the impact of real estate recession more widespread. Angus Reed who is a real estate expert agreed to give us some tips on what are some lesser known good investments methods in the real estate. (Click here to know more about Angus Reed)
Following are the investment options available for you if you want to invest in real estate but don’t have a huge amount of money for it. Also, if you want to diversify your portfolio, you should consider these options:
- Real Estate Investment Trusts: A Real Estate Investment Trust or REIT is a company that owns, and in most cases operates, income-producing real estates such as an office building, warehouse, hospitals, shopping malls and their mortgages and loans. Shares of many of these companies are publicly traded in a stock exchange, just like any other company and can be bought through a broker. The shareholders in these companies get the capital appreciation and the income of the real estate the REIT owns without the trouble of maintaining, purchasing or transferring a property.
- Crowdfunding: Crowdfunding means, raising funds for investments from a large pool of people. The amount is raised and executed through the internet. This opportunity provides people from different income groups to invest in properties that are around them which they otherwise wouldn’t be able to do. This system does not include any middle man and the profit is equally divided only among its members, which increases the margin of an individual. This system has been in place since the 2012 and has continued to grow since.
- Renovating a property: If you can work hard and look after things with ease, this option is good for you. The good thing about distressed properties is that they are usually well priced. If you think the price is not very cheap, you can and you should ask for a better deal. This is not only a good option for buying your own house, but also if you are thinking about it as an investment. If you know the people who can help you fix the property and you get enough time to look after it, this strategy has the potential of give you handsome returns.
The above-mentioned three methods should be chosen according to the time you think you can devote on this outside of your schedule. From first to the third option the amount of time that one should invest is in the increasing order. You should determine your investment option very carefully.
Closing thoughts: One can only become rich through investment and be safe through diversification of one’s investments. The markets are always uncertain and will remain so, there will never be a sure-shot way to make huge profits but one thing can be stated very clear, for getting great returns, you first need to start investing!