Real estate investments are a great way to save for the future and create a retirement fund. There are also a lot of tax advantages to investing in the real estate market and it is much safer than the ups and downs of the stock market which you have no control over. Keeping money in a bank won’t make you much money either. Let us walk you through the steps of earning a healthy profit secured by tangible assets in a safe local real estate market.
Since property is the most limited resource on the planet, real estate investors find most property investments to be wise choices. Most of the risk involved is in making educated choices of what real estate to buy.
We have all heard the old adage, “it takes money to earn money.” It’s much like being turned away for a job because you don’t have the experience, but you can’t get the experience without first getting the job. Once you get started, however, you’ll discover that over the long term, your cash flow will become more lucrative once you fix and flip or have rental properties.
Here are a few options for those early investments:
Now that you have cash in hand, what’s next? This step takes some savvy and it is mostly built upon with experience. In other words, this will get easier as you go, and like with any endeavor, you will make mistakes along the way.
Fixer Uppers or Fix and Flip
There is considerable potential in purchasing distressed or shoddy properties, especially if you have a background in construction, electricity or other building skills. Hence, it bears repeating that in the economics supply/demand paradigm, the key is to buy low and sell high. This endeavor also requires a skillful eye to visualize what it could be with a minimal but sufficient amount of money poured into making improvements.
Short Sales and Other Foreclosures
This method of investing in real estate can be a little hard on the heart because it requires investing in others’ losses or deficits. A short sale is defined by debtors agreeing to let the property go at less than what the total debt is on the property. It is much like a car that is repossessed with a negative equity. In this case, if all lien holders and/or individual investors agree to accept less than the amount owed on the debt, a sale of the property can be accomplished. In this category, there is potential for capital gains based on the losses of others.
Investments in Rental Properties
If you are a great “people person,” yet a shrewd collector, investing in rental properties may be your forte. Many of today’s self-made millionaires fall into that category based on ownership of massive apartment complexes and/or office buildings. Remember that rental properties are not always homes or apartments! Do not overlook the potential in different types of real estate investment.
Perhaps the best bit of advice can be surmised in these few steps:
There are many options in the real estate market. Whether you decide to become a property owner or a note holder, we can help you step into your investment with expert knowledge.
Contact our team of experts at Acala Investments today to get started!
Acala Investments provides a wide range of services beyond its core focus on real estate investments. These services are designed to meet the diverse needs of its clients and may include Mortgage Lending, Brokerage Services, Commercial Real Estate and Development, leasing, and advisory services.
