Most business experts would agree that allocating assets into real estate is a good way to balance one’s investment portfolio. As our society, continuously and rapidly modernizes and population grows in most parts of the world, the need for housing and infrastructure also increases.
The real estate market is an ideal prospect for investors with a low risk appetite. Unlike the stock market, it’s something that would not give you any surprises within a day, or even a week. Even a beginner would be able to get an inkling as to where the market is headed. Studies have also shown real estate to be a viable avenue of investment during bearish trends.
However, one thing to know, investing in real estate won’t get you rich overnight. In fact, one advice that most real estate investors would give would be wary of “get rich” schemes. Although there are fast ways to make money in the real estate business, don’t get the impression that it’ll be similar to hitting a jackpot.
Arguably, the fastest way to make a decent buck in the real estate game would be to use the Wholesale strategy. This is where you simply assign or “flip” contracts and take a percentage off the deal. You can even profit even if the deal doesn’t fall through by securing what is called a non-refundable earnest money deposit. The turnaround for this strategy is 20 days or less, and you just need some walking around money at the very least to get started.
A strategy that takes a bit longer, around 45 days, and secures you a small, decent profit for your efforts would be the Lipstick Flip. This involves reselling a property after you’ve made some cosmetic repairs on it, which shouldn’t cost more than $5000. It is a well-known fact that improving curb appeal can drastically increase a property’s value.
Next would be the Buy & Hold strategy, which is a more traditional and straightforward way of investing in real estate. Basically, you would want to buy a place with the intention of renting it out. While you’ll probably need a significant amount to buy and fix up your target property, your goal is to recoup your capital from the regular cash flow from your tenants.
Lastly, we have the Buy, Renovate, Rent, Refinance, and Repeat strategy, which is somewhat a modified version of Buy & Hold. This is a long-term strategy where you use loans and refinancing schemes to fund your acquisition and maintenance of properties that you will be renting out. By holding a piece of property, you are also looking for it to appreciate value and increase rent as development in the location picks up.
To get more details on these strategies, check out this infographic from Offer Climb Houston and Offer Climb Phoenix.
