Learning the ways to Invest in Real Estate?

Learning the ways to Invest in Real Estate?

By: kenfong

Are there many benefits to investing in Real Estate? You bet there are!

Your plunge in Real Estate can give you a monthly cash flow or at least be paid for by your tenants. You may gain some tax saving and the property can possibly increase its value.

You are free to select the type of property, locale, condition and price that you want to pay. If you want more income, you can buy more units and stretch the length of the repayment.

Or if you if you want to decrease your taxes, you can use a technique called depreciation to offset your income. You can also concentrate on appreciation by purchasing undervalued properties and selling them for a higher value or you could buy properties, fix them up and sell them for a higher profit.

Let us explore at the many ways that we can invest in real estate

1. Creating a Monthly Income

You simply rent out the properties that you buy. You arrange the financing such that the repayment is lower than the rental that you receive and in the process have a net cash income.

In addition to a positive cash flow, there are annual tax advantages to owning real estate and appreciation that is realized at the time of sale.

2. Buy & Sell

You make money by buying properties for less and selling them for more. You can look at older properties that need improvement, or buy newer properties from owners who are willing to let go at a lower price.

When you buy property that needs to be touched up, you must consider the holding cost that includes taxes, interest payment, utilities, maintenance and other costs.

When you buy a property from a distressed owner, the property is often in good condition. The owner has either fallen behind in mortgage payments or taxes, or want to let go of the property due to migration, divorce, etc.

3. Lease Option

With leasing option, you do not buy the property. You simply take temporary control and sell or rent it to another tenant.

4. Purchasing Tax Liens Property

This can be purchased from the government. You simply place a deposit as designated by the government and stick around for the waiting period to expire. If the taxes are not paid, you get the property. In the meantime your money earns interest and your deposit is guaranteed by the government

5. Pre- Construction

Here, you work out an arrangement with the builders to buy at wholesale price and sell them when completed at market price. In this method there is no need to worry about mortgage payment or tenants during the construction period.

I hope you now understand the many ways to make money in real estate.