Posted on: 29 April 2020
One of the best ways to build wealth is by purchasing real estate. There are multiple ways you can enter into the real estate market and start building your wealth through real estate investments.
#1: Become a Residential Landlord
One of the most common ways to enter the real estate market is by purchasing a second home. When it comes to purchasing a second home, many people like to go for a fixer-upper that they can work on and improve before renting out.
However, you can also purchase a more move-in-ready home and rent that home out as well. Residential rental properties work best when you use a property management company to take care of the home. A property management company can help ease the usual stress of being a landlord and help you make money on the endeavor.
#2: Join a Real Estate Investment Group
Another option that is becoming more common is to join a real estate investment group (REIG). With an REIG, you will invest a certain amount of money it the group. Depending on the group, the money will be used to invest in property. With an REIG, you may also invest money into multiple different properties, spreading out the risk of your investment.
Then, the money that is gained from renting out the property will be returned to the members of the investing group. If the property is sold, the members of the REIG will get to enjoy some of the profit. Generally, members will then take the money and re-invest it back into the group.
#3: Real Estate Investment Trusts (REIT)
Another option is a REIT, which is more like purchasing stock then purchasing a property. With a REIT, you are purchasing stock in a company that holds their money in commercial properties. The trust will use the money from their investors to purchase commercial properties, and then will pay dividends on the taxable profit from the properties. You can easily cash out your investments because you essentially own stock in real estate instead of the real estate itself. Some REITs are based on owning buildings and others that are about owning mortgages on properties, which are two different types of REITs.
If you are looking to build your wealth, look into different ways to invest in real estate. You can become a landlord on a traditional single-family home property, you can join a real estate investment group, or you can join a real estate investment trust.Share