5 Ways to Invest in Real Estate
With over 90% of the world’s millionaires having some stake in rental property, real estate is a dependable and lucrative source of income. In Buying Your First Rental | 5 Ways to Buy An Investment Property | RE Investing For Beginners, Avery breaks down five ways to add this type of investment to your portfolio.
- Traditional Investment Property
This RE strategy is perhaps the most straight-forward and well-known. Accordingly, it is a great first option to consider for those new to RE. Traditional investment property entails bank financing a building before renting it out. After the paperwork is signed, the owner may choose to renovate the home to make it more attractive to buyers, or simply rent it out as is.
- Househacking
One of Avery’s personal favorites, househacking is a great way to both cover your own living expenses and earn some extra dough. This method requires the purchase of a one to four unit residential building in which the owner occupies one unit. Essentially, the investor is able to finance their mortgage with payments from the tenets they share the building with.
Learn more about this profitable option here.
- Owner-occupied Vacation Rental
As more people are getting vaccinated and travel is picking up again, this form of RE investment deserves serious consideration. Vacation homes are often able to draw higher rates of cash flow than residential rentals, making them especially attractive to investors like you. Accordingly, it may be wise to put that cottage you’re too busy to visit on Airbnb.
- Syndication
If you’re a surgeon, CEO, or simply never seem to have enough time on your hands, syndication might be the best option for you. Somewhat like the stock market, syndication involves funding a syndicator (usually a developer or buyer) in exchange for equity in a housing project.
- Renting Your Primary Residence
While some may not relish the idea of moving out of their permanent residence, it can definitely prove profitable. Because you’re already residing in it, your home may already be at a desirable location or have renovations that would make it as attractive to tenants as it is to you.
All in all, traditional investment property, househacking, owner-occupied vacation rentals, syndication, and renting your primary residence are all viable ways to build your wealth. Make sure to watch the accompanying video to get a better, more detailed idea of how you can assess each of these options and consider the benefits of investing in RE. Which of these methods do you think you would employ? Let us know in the comments!