Real estate investment trusts (REIs) offer great real estate exposure without actually having, own, or finance the properties themselves. Real estate investment is a popular investment strategy over the past 50 years or so, particularly in the United States. Here is a closer look at some of your best choices for real estate investments, and the reasons to invest in real estate. Investing in real estate can be a lucrative business – even in today’s difficult economy.
One option for real estate investing that has always been popular is flipping houses. Flipping houses refers to buying a foreclosed property, fixing it up a bit, and then reselling it for a profit. Some investors focus on residential flipping houses, focusing on selling them quickly to make a profit, while others dabble in commercial property flipping houses, concentrating on properties that can earn higher profits. The best way to decide if you’d like to get into flipping houses is to start by looking for foreclosure properties – often at foreclosure auctions. You’ll have an easier time picking out the houses you want to flip if you go to real estate auctions as opposed to general property open houses.
Buying REO properties is another option for real estate investment. REO stands for real estate owned. In this case, the bank owns the property itself, but offers it to the public as part of a foreclosure process. Many investors love buying foreclosed properties because they pay significantly lower than the market value.
One of the most popular ways of how to invest in real estate investing is buying rental properties. Rental properties are a great long term investment. Since they are not owned by anyone, they are much less risky. As a matter of fact, many landlords rent out their properties for part of their monthly income. This allows them to eventually recoup most of the cost of the property without having to spend a lot of money. If you are looking for a way of earning passive income, investing in rental properties is a great way of doing just that.
One of the most popular ways of investing in real estate today involves commercial real estate investing. Many commercial properties are purchased and then resold to generate profits. The best commercial properties to invest in are those that are not being rented out, but are owned outright. These properties can be bought and resold inexpensively. Some investors even hold these properties ‘as is,’ allowing them to purchase ‘free and clear.’
Many investors prefer to have a mix of real estate investments, so they have some cash flow in other areas. One great way of how to invest in real estate investments is through real estate mutual funds. These funds typically offer investors the opportunity to manage more than one asset class at a time; this is especially helpful for those investors who have other businesses, such as franchises.
Another type of investment that is gaining popularity with real estate investors is through the purchase and holding of real estate stocks and bonds. There are various different types of real estate stocks and bonds, including fixed income securities (FDI), growth stocks, and option stocks. Fixed income securities generally offer higher interest rates and longer terms than do growth stocks and option stocks. These securities also make good long-term investments because they don’t fluctuate significantly according to the market. As an example, real estate stocks usually remain steady or increase in value over time.
Real estate mutual funds exchange-traded funds are another option for investors interested in investing in real estate. Exchange-traded funds generally represent a basket of various investments. Investors choose securities according to their risk tolerance, capital appreciation, and overall profit expectations. These types of funds may be both beneficial to new investors and experienced investors. If you’re an experienced investor looking to diversify your portfolio, exchange-traded funds may be the right choice for you.