If you’re like many Americans, you’re hoping to save money for the future. You want to invest your money in something that helps it to grow over time.
Real estate investments are the answer to building wealth for many people. In fact, 28% of Americans believe investing in real estate is the way to go if you can leave more money alone for more than 10 years.
While it might sound like a great idea, real estate investing for beginners can be intimidating. Many are nervous about how to make the leap into real estate investing. Or they worry they don’t have enough capital to actually be a real estate investor.
Read on to learn more about real estate investing for beginners and how you can get started investing too.
Why Real Estate Investing Makes Sense
If you’re like many people, you want to invest your money where it has the potential to grow, but also to be safe at the same time.
Investments like buying stocks hold some greater risk if there’s volatility in the market.
Real estate is often a great option for investing for beginners. If you can put your money into real estate, historically it’s been both a safe option and a lucrative one over the long haul.
Many people also appreciate investing in something more tangible like a home or piece of property.
Types of Real Estate Investing
Another advantage of real estate investing for beginners is the several options you have to get started. There are many different types of real investing you could opt for.
Some are more hands-on and require a higher level of engagement from you as an owner. While others allow you to invest in real estate, while still being a more passive investor.
Let’s take a look at some types of real estate investing you could consider as a beginner.
Rental Property
Probably the most traditional real estate investing involves buying a property and using it as a rental property. You buy a house, apartment, vacation property, or even a commercial property, then rent it to someone else.
You can gain revenue a few ways with rental properties, through rent and the appreciation of the property.
Check out Kiavi for financing options when considering rental property as an option.
Real Estate Investment Trusts (REITS)
Real estate investment trusts or REITS work much like a mutual fund with properties. You buy into the trust and the trust combines the money from all the investors to buy properties.
As an investor in a REIT, you own shares of the property. This option allows you to get involved in property ownership without the same level of hands-on involvement you might need with a rental property.
Flipping Houses
Flipping houses became a popular option when the real estate market was struggling. A real estate investor buys a property, fixes it up, then resells it quickly to make a profit.
Understanding Real Estate Investing for Beginners
With so many different options for investing in real estate, it doesn’t have to be that hard to get started. Real estate investing for beginners means doing some research and planning and choosing the option that best fits your investing profile.
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