If you’re considering real estate investing, you’re probably wondering where to start. Once you begin researching, you’ll realize there are various ways to invest and many different routes you can take. It’s smart to start small and let it grow from there.
Here are four ways to get started in real estate investing.
Typically you don’t think of living in a primary home as “investing,” but it’s a great strategy to boost your net worth over time. Buying your first home is a great investment because you can put little money down to start, the value will increase over time, and when you’re ready to upsize, you can generally sell the home for a profit. If you don’t want to sell the home, you can keep it and rent it out, earning you passive income.
Many successful real estate investors start by purchasing multi-family homes. Multi-family homes come with multiple benefits because not only do you own the home, but you can also live in one of the units and earn an income from other renters. This method also has some challenges, including collecting rent, making repairs and maintenance, and more. These challenges will come down to you having to do them yourself unless you have the money to pay a landlord.
Vacation homes are great because they give you somewhere to stay when you need a vacation and earn you rental income when you’re not there. The income you earn from other visitors can help pay for the mortgage, maintenance repairs, taxes, and more. However, much like multi-family homes, you will need someone to manage these things while you’re not there, which comes at a cost.
Investment Properties/Flipping Homes
Purchasing a single-family or multi-family home and flipping it has become a very popular way to invest and make money. Your first flip might be challenging, but once you get the right people in place and get a few under your belt, you’ll get the hang of it. Financing flips can be tricky because you can’t use a standard mortgage, so you’ll have to finance it yourself.
These are some of the most popular ways to invest in real estate. You can explore other options as you get into it and get more comfortable with it. If you have any questions about real estate investing, reach out to us! We would love to help!