3 Ways to Invest in Real Estate

By Mary B. Hill 2 years ago
6 Ways to Invest in Real Estate to Make Money and Build Wealth

If you’re looking for a way to pad your retirement, make some extra cash on the side, or even start a lucrative business, real estate investing Denver-based can be a good choice. And depending on your goals, there are several different ways to go about making money through real estate investing, including those listed below. 

Buy and Flip

This is the type of investment that fills TVs across the country. You see someone take a team in and fix up an old or run-down home. Then, they flip it for a nice profit. 

If you’re the hands-on type, this can be a great choice for you. However, it’s important to know that things are never as easy as they seem on TV. The people on those shows have a team to help them make their goals a reality. 

If you do, too, that’s great. If you don’t, know that it’s going to take a great deal of time and energy. You can do it, of course, but you should be prepared for what’s ahead of you. 

Rental Properties 

There are many people who purchase a home for rental income. If you have the cash up front to buy the home, you can get to the profits more quickly. However, if you have to get a loan for the home, you’ll have to make sure that you charge enough rent to make the payment. 

Also, you’ll need some money put to the side for months when tenants are running late on their payments or times that your property sits empty. Otherwise, your credit will suffer. 

Passive Investments 

If you like the idea of making cash off of real estate but don’t want to be hands-on with any of it, there are plenty of passive avenues. You have REIGs or real estate investment groups that act like mutual funds. You invest in a group, and then a company buys or builds properties – usually condos or apartments. Later, you can purchase the individual units. 

REITs or real estate investment trusts are great for those who don’t have a large amount to invest. You can typically start with just a few hundred dollars. A corporation uses the investors’ money to buy and manage income properties while you collect dividends. 

As you can see, there are several ways that you can make money from investing in real estate. The avenue you choose will depend on your goals and how hands-on you choose to be.