They say that home is where the heart is, but home can also be where the money is if you apply some strategy and elbow grease to your newly acquired home. Real estate investment can be incredibly lucrative, but it’s not for everyone. There is a financial barrier to entry, for one thing, but there’s also a lot of work involved, both physically and mentally. Here’s what you need to know.
Establishing an Apartment Complex
Rental properties offer their owners and landlords numerous advantages. First and foremost, rental properties are a cash cow, simply because you can continue to make money from renting apartments to a series of tenants instead of selling the property outright. The downside is that you won’t receive the lump sum that selling a house would give you, but this trade is more than worth it if you’re patient. However, being a landlord also entails an ongoing responsibility in addition to the ongoing monetary benefits. Landlords are responsible for the living conditions of the rental properties. An apartment complex also has certain additional requirements when compared to a house. For example, you’ll need to work with a multifamily utility company in order to have each apartment attached to a different utility bill for each different tenant, and each unit will need to be furnished with the essentials such as an oven and a refrigerator.
House flipping offers you the opportunity to make a more substantial sum of money all at once, but there’s a downside. While you get to make a large amount of money in one fell swoop, you’ll also be responsible for overhauling the house in question in a relatively short amount of time, as well. Flipping houses is a ton of work with an immense profit margin, making it a great choice for those who aren’t afraid to get their hands dirty. The general gist of flipping a house is that you start with the acquisition of a fixer upper, a house desperately in need of repairs and therefore very cheap. Then, you’ll need to painstakingly repair damages and modernize this otherwise dilapidated home in order to make it more appealing to potential buyers and more valuable on the real estate market. This can entail things like tearing down walls and replacing insulation, for example, but it can also mean replacing outdated features with more modern ones. Giving the home a fresh coat of paint inside and out is a must, but you may also have to fix faulty wiring or replace lumber that has been rotted away by water damage.
Renting Your Own Property
While flipping houses and being a landlord require some venture capital to your name, you can still make money via your own property at a fraction of the cost. You can start by doubling up on the sort of things often included in rental properties, such as appliances, and then you simply rent a portion of your space to others. You can rent out your entire house on a periodic basis a la Airbnb, or you can rent a room to someone in need of permanent or semi-permanent lodging for a longer period of time. Make sure to get your arrangement in writing, just in case. You never know who you can or can’t trust, and the lack of a written agreement can result in your tenant pulling one over on you, because these matters tend to favor the tenant if there’s no violation of a formal rule. This is a particularly good solution for those who need some extra income or simply have too much space in their home.
Living space is always in demand, because everyone needs a roof over his or her head. That’s why a particularly industrious or business savvy individual can leverage hir or her own assets to become a real estate mogul and make a major profit. These tips will help you take control of your destiny by investing in real estate.