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Realastate is it a good investment?

Although the realastate market is currently in a slump, experts predict it will rebound in the near future. Savvy investors know now is the time to get in on great real estate deals that can yield plenty of profits in the future.

If you are just starting out in the realastate game, you will want to learn all there is to know before shelling out your hard earned cash. There are numerous types of realastate investments including houses, apartment buildings, condos, retail centers, office buildings, undeveloped land and real estate investment trusts (REIT).

REITs allow multiple investors to purchase shares directly on an open exchange or by investing in a mutual fund specializing in public real estate. REITs are managed through a corporation and subject to little or no federal income tax. REITs typically offer investors high yields and a liquid method of investing in realastate.

The majority of people new to realastate investing start out by purchasing a single dwelling home. Oftentimes, the home is used as rental property. Rental properties can include houses, condos and mobile homes. These types of properties can also be used as vacation rentals. Many investors find vacation rentals in hot markets yield a higher profit than if they were rented on a long-term basis.

Due to the tremendous influx of bankruptcies, many people are unable to utilize traditional financing methods to obtain a mortgage. As an alternative, real estate investors now offer rent-to-own options. This is a relatively safe realastate investment, as long as the deal is structured properly.

With rent-to-own, investors carry the realastate note and charge rent to the potential buyer. The investor and potential buyer agree upon a purchase amount. A percentage of rent money is applied toward the purchase of the home. This type of financing is usually offered for 3 to 5 years and allows the buyer to restore his or her credit.

When the agreement expires, the buyer obtains financing for the balance of the loan. If the buyer is unable to obtain financing, the deal can be renegotiated or rendered null and void. The investor could then offer it on the market as a rent-to-own property or sell it outright.

Many realastate investors find house flipping a quick way to turn a profit. The goal is to purchase a distressed property under market value, make repairs or renovations, than sell it quickly. If you pick the right house and can make repairs in a timely fashion, you can turn a profit of $30,000 or more in 90 days or less.

Sounds enticing, doesn't it? The truth of the matter is house flipping can be extremely profitable. It can also cause devastating loss. Should you decide to get involved in this type of realastate investment, be certain to thoroughly educate yourself about the process.

Investing in realastate can be a rewarding and profitable experience. Many people have become self-made millionaires by taking time to learn the ropes. You don't have to be a genius to learn, nor do you have to be wealthy to play the game. It's simply of a matter of understanding the rules and paying attention to details.


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Published on December 03, 2007 at 08:35 AM | Comments: 3

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Comments

Thats good stuff! I have been learning a lot from your site. I can't wait until you start posting the real estate for the single family residents from the bank portfolios. I have cash and ready to purchase as much as I am able.

Keep up the good work and keep us informed.

Myreesha | January 18, 2008 9:50 PM

 

I'm learning alot about real estate investing from your site. I had never heard of REIT before. This is something I would like to know more about. Thanks for sharing your knowledge about real estate and finances. ~ Darby

Darby | February 7, 2008 12:24 PM

 

All of this really make sence to me. I have been trying to start to invest in real estate, but I have a fairly low credit score and an small amount of money in the bank. I like reading all your articles they give some guidiance and help educate my wife and I. I will be waiting for more articles or blogs about real estate investing.

Dan | February 13, 2008 11:30 AM

 

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