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2 Easy Ways to Invest in Real Estate

2 Easy Ways to Invest in Real Estate

Nowadays buying properties is more than just finding a place to call home. As you all know, investing in real estate has become increasingly popular and has also become a common investment vehicle. The real estate market has plenty of opportunities for making a lot of money. Let's go ahead and explore real estate as an investment tool.

1) The most common form of investment is a person who will buy a property and rent it out to a tenant. The owner of the property in this scenario the 'landlord” is responsible for paying the mortgage, taxes, and costs of maintaining the property. The idea here is to charge a little more in order to cover all the monthly expenses and produce a monthly profit. With this strategy the owner will have to be patient until the mortgage has been paid off. Also, with time the property may possibly appreciated in value over the course of the mortgage, leaving the owner/landlord with a more valuable asset.

There are ups and downs to this strategy. I would recommend hiring a professional property management company to handle all of your rentals. Or at a minimum protecting your property by purchasing a home warranty, this will come in handy when you have repairs that you have to make to the house.

2) The second strategy of owning real estate is by joining Real Estate Investment Groups. If you want to own a rental property, but don't want to be a landlord, a real estate investment group may be the solution for you. Typically the way it works is a company will buy or build a set of condominiums and then allow investors to buy them through the company, this is the way you join the group. A single investor can own one or multiple units, but the company operating the investment group collectively manages the units, taking care of maintenance, advertising vacant units and interviewing tenants. In exchange for this management, the company takes a percentage of the monthly rent.

There are different versions of investment groups, but in the most common version, the lease is in the investor's name and all of the units pool a portion of the rent to guard against occasional vacancies, meaning that you will receive enough to pay the mortgage even if your unit is empty. The quality of an investment group depends entirely on the company offering it. In theory, it is a safe way to get into real estate investment. Do your research to find a groups that fits your needs.

There are other ways to invest in real estate, we will be exploring these in the near future. To all the Real Life Traders, if there is anything I can help you with, do not hesitate to email or call!

Real Life Trader - Lidia Barbosa

Keller Williams, Cal BRE#01986793


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