If you’re looking to diversify your investing portfolio then real estate investing can be a great option for you to get into the market for some serious, lucrative returns. Buying and owning real estate can be quite an exciting investment strategy that can land you an additional, satisfying income stream. But the downside is that many people don’t know much about how to invest in this sector. Here are some of the best ways to make money by investing in real estate.
Buy REITs (real estate investment trusts)
REITs or real estate investment trusts are for those people who want to invest in real estate without engaging themselves with the hassle of a traditional real estate transaction or, in other words, without the physical real estate. Much like mutual funds, these trusts are companies that own multiple properties like office buildings, retail spaces, apartments, hotels and restaurants. REITs are known for paying high rates of returns that are commonly used by investors to buy more property with them, hence increasing their share of dividends even further.
Use an online real estate investing platform
There are lots of online platforms that act as meeting places for real estate developers and investors who want to fund their ongoing projects using debt or equity. Investors pay a heavy fee to the platform and risk their capital in exchange for a receiving a monthly or quarterly reimbursement. But the down side is that you cannot easily sell them smoothly the way you can unload a share of stock.
Think about investing in rental properties
You can rent out rooms or units in your residence while still living in it. This is sometimes referred to as “house hacking,” a term used by an online real estate investor resource BiggerPockets. It simply means that you occupy your investment property and either rent out rooms or rent out whole units if it’s a multi-unit or multi-story building. You can also buy an entire investment property and then rent it all out. Remember to find a property with expenses lower than the amount you want to charge its rent for.
Consider flipping investment properties
Investing in an undervalued home that needs a little renovation is a great way to earn money by reselling it for a profit after some time. This is just like online website flipping but demands a far greater effort and time. The risk involved is higher, but it won’t bother you much if you find an experienced partner and cut down on your expenses by living in the same residence you fix up.
Rent out a room
Finally, you can rent out a part of your home, a room or two, via sites like Airbnb. The good thing about it is that you don’t have to let in long-term tenants because online accommodation sharing companies like Airbnb prescreen the tenants to a great extent and provides protection against any possible damages. Renting rooms are quite accessible than real estate investment. If you ever wanted to try to earn more money by renting out a room in your home please click here to start investing with AirBNB. Click here if you need to book a room with AirBNB
