Today, the real estate investment market is bursting with lucrative opportunities and increasing competition. As the older investors gain more experience, there are thousands of new investors every year. The real estate market is an open domain that has opportunities for all. Through this article you will learn about the most common strategies for beginning and advance level investors. Using these will help you creatively chalk out your personal investing technique.
- Beginners’ Strategy : Low Risk
If you are a beginner to the investing world, low risk strategies should be your preferred option. They are simpler because the stakes are low and even in worst case scenarios – losses are minimal.
The most common beginners’ techniques are lease options, wholesaling (sometimes referred to as quick-flipping properties) and taking Title Ownership.
Another profitable way is by taking ownership of mobile houses. This is a great way for families to create a regular monthly cash flow through rental.
- Advanced Strategy : High Risk
Needless to say, high risk means high profit. Advanced level investors prefer high risk investments as they reap higher benefits. High risk does not necessarily mean an unreasonably tricky, make-or-break situation. It just means that the stakes are comparatively higher.
Take a look at some of the common techniques used by the advance investor.
- Commercial Real Estate
More experienced buyers often go in for investing in the commercial real estate sector as the profits are really high. The variety of commercial properties such as office buildings, etc. is a major reason for the growth in commercial real estate investments.
- Foreclosed Properties
There is a rising investment trend in the foreclosures sector. The benefits are high because of significantly low purchase prices. Bank Foreclosed Real Estate (REOs) which may be available with or without the provision for a short sale is also known to generate colossal profits.
- Rehabbing
This is a common term used for buying foreclosed or regular property, refurbishing it and then either reselling or subletting it on monthly/quarterly/yearly rental. If you are a seasoned buyer then “flipping” a house or leasing it out will be highly profitable. An important rule that applies here is: Refrain from being the repair-person. It is advisable to hire a trained professional for the purpose.
- Other Techniques
Another common way is to buy and hold single family houses and use them to generate monthly rental. This is a very lucrative option as it promises a good monthly cash flow and reasonable yearly cash deductions. And of course – there is a huge profit at the time of reselling.
Renting a property, however, requires knowledge of the basic landlord practices.
Paperwork experts (Trust Deeds, Contractual Agreements, Discounted Mortgages, etc.) understand the importance of combining the two – real estate paper and real estate transactions. Smart paperwork is a fundamental building block to outsmart and out-maneuver competitors and create a bullet proof deal.
Combining these methods will help you bag a profitable real estate investment.
