properties. A REIT owns, operates, or finances income-generating real estate properties. Investing in REITs can give you exposure to a diversified portfolio of real estate assets. REITs are traded on stock exchanges, making them a more liquid investment compared to direct property ownership. NO. 5 REAL ESTATE CROWDFUNDING. Pooling your money online with other investors to purchase property (or a share of property) as a group is a strategy known as real estate crowdfunding. It makes it possible for you to get started with property ownership and rentals with minimal upfront investment. Crowdfunding platforms let you invest with as little as a few dollars. Some of the best real estate crowdfunding platforms include RealtyMogul, Yield- street, EquityMultiple, DiversyFund, and Fundrise. NO. 6 FLIPPING HOUSES. Flipping involves an investor purchasing a property with the intention of selling it for a profit rather than using it. Investors who flip properties focus on purchasing and reselling one or a group of properties. Some investors successfully generate a steady flow of income by participating in fre- quent flips. However, flipping comes with several pitfalls. Profits are typi - cally derived from price appreciation resulting from a hot real estate mar- ket. Before flipping a house, re - search the market, secure finances, make smart investments, find and buy a house, and sell it for a profit. Remember, investing in real estate requires knowledge, research, and careful consideration. Understand the risks and benefits of each investment strategy before making any decisions. Always make it a point to discuss your investment plans
with a professional financial advisor or real estate expert before making an investment.
NO. 1 RENTAL PROPERTIES. Purchasing rental real estate (e.g., vacation homes, multifamily homes, or single-family homes) requires a knowledge of leasing, mortgage loans, tenant and landlord relationships, and property management. Investors usually need a 15%-25% down payment for a rental property mortgage. Being a landlord requires broad skills, ranging from understanding basic tenant law to fixing a leaky faucet. Full-time investors spend a lot of time choosing houses and fixing them up to sell or rent. LONG-TERM BUY AND HOLD. The long-term buy-and-hold strategy involves purchasing properties with the intention of holding onto them for an extended period. This strategy leverages the power of appreciation, rental income, and tax advantages over time. By acquiring properties in desirable locations and holding onto them for the long haul, you can ben- efit from both rental income and po - tential appreciation, maximizing your wealth accumulation for retirement. NO. 2 NO. 3 HOUSE HACKING. House hacking involves purchasing a multi- unit property that allows you to live in one unit and rent the remaining units. This strategy allows you to offset or eliminate your housing expenses entirely and save more money for retirement. House hacking can be an effective way to generate rental income and build equity while minimizing your own living costs.
RESEARCH AND DUE DILIGENCE Before diving into real estate investments, thorough research and due diligence are paramount. Here are several key areas to focus on during your investment analysis. Location Analysis. Location plays a crucial role in the success of real estate investments. Researching and understanding the local market conditions, economic factors, job growth, infrastructure development, and demographic trends are essential. Investing in properties located in desirable areas with potential for growth can maximize your chances of long- term success. Property Analysis. Conduct a thorough analysis of individual properties. Among the factors to evaluate are property condition, rental demand, potential rental income, maintenance costs, and appreciation potential. Engaging professional property inspectors and conducting property appraisals can provide you with valuable insights for making informed investment decisions. Financial Analysis. This involves assessing the financial viability of an investment property. Key consid- erations are cash flow projections, operating expenses, financing options, and return on investment calculations. A comprehensive financial analysis allows you to determine the profitability of the investment and its alignment with your retirement goals.
NO. 4
REAL ESTATE INVESTMENT
TRUSTS (REITS). Real Estate Investment Trusts, or REITs, provide an opportunity to invest in real estate without directly owning physical
28 | think realty magazine :: november – december 2023
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