With interest rates low, the stock market volatile, cryptocurrency having finally slowed down, and the whole financial market looking a bit fragile right now, where can you invest your money wisely to see either short term gains or long-term growth with regular returns? Realistically real estate investing could be one of the most stable and profitable investment vehicles right now.
What Types of Real Estate Investing are Available?
There are several ways to invest in the real estate market, and the best choice for you will depend on whether you want to make a good return right now, or you want a long term investment which will provide a small return regularly until you cash out and you make a large return in the future. Another factor too is whether you have any property renovation skills!
House flipping is your first option, and interestingly is becoming more common with 10% of all house being sold every year having been flipped. What is house flipping? You buy a rundown house, renovate it and sell it at a profit. What type of profits are there to be made? Well that depends on what property you buy. If you can buy the worst property on the best street in town, then you will make a pretty sum. Typically buying a property for $100,000, expecting to pay $30,000 for renovations you should expect to sell it for $160,000 or more. You could of course lower that $30,000 figure by doing as much of the work yourself as is possible. And you could increase the selling price by extending the property or renovating it to a higher specification, as long as the area and the property will tolerate that extent of work.
Your aim with house flipping is to turn around the property as soon as possible so your money is returned at profit in a shorter space of time. Then you reinvest it in another property and start again.
The other major investment choice with properties is buying to let. You either buy a property that has an established tenant, and let it run, or you buy a property that needs some work, renovate it and then then let it out. If you do buy to let it can be a very good long term investment if you choose the right property because not only will the property increase in value with the market, but also you’re receiving a monthly income from the property that should more than cover your costs.
Another option with property investment is multi-family investment properties. That is buying a property that has more than one dwelling, such as a purpose built block of apartments or a large house that has or can be separated into several apartments. The monthly returns on multi-family properties are usually higher and more stable than a single rental dwelling. Of course there is more upfront investment but long term dividends are high.
So whatever your approach to investment there is a property investment option for you.