You may have heard about investing in real estate to gain high profits and increase your net worth. And you have heard correctly. Investing in real estate can be extremely profitable, but it could also mean investing in a large amount of initial capital and doing a lot of different things, from buying and renting our property, to fixing and flipping places, to creating vacation homes.
Naomi Hebert/Unsplash. Investing in real estate has always been profitable.
Before you start investing, you might get overwhelmed during initial research and knowing about the large investment required. But take a deep breath, settle on a path and begin researching.
A safe investment is to put your money in a primary home. It might not seem like an investment at first, but it makes a great learning opportunity, and can give you excellent profit, increasing your net worth eventually.
Buying out a primary home to live in as a real estate investment is also recommended because you can mostly purchase it with minimum down payment. And as you plan to sell it off or rent it out, you earn yourself a passive income or some great profits.
Experts say that this is the best way to enter into the rental property ownership business, and you end up making more money with better rates and terms.
Other options on beginning your real estate investment journey are :
Breno Assis/Unsplash. Multi Family homes make it easier to rent out the other units, and are a great starting investment.
Buy a multifamily home
A multifamily home is also one of the most common ways people begin investing in real estate. These multi unit houses provide you a dual benefit ;you can live in a unit and rent out the others. In the beginning, the rent would only be covering your mortgage, but with time, your rental income would increase significantly. Some issues with a multi-family house are the screening and searching for suitable tenants, making repairs and maintaining the different units.
Buy a vacation home :
Vacation homes are also doubly beneficial. They can serve as a home away from home when you are in need for a break, and it can also earn you a passive income in rentals when you are not visiting.
Grant Durr/Unsplash. Vacation homes are easier to finance, but need repair and maintenance which may add up to costs.
The rental income could pay off mortgage, make up for repair and maintenance costs and help pay off property taxes. A vacation home is also easier to finance, as their mortgage rates are closest to primary home rates. These vacation homes do come with a cost though. Cleaning, coordinating with vacationers, collecting rents and marketing your vacation home are just some of the issues a vacation home owner has to deal with.
