Real estate investment can be very lucrative if you know what you are doing. Many of the world’s richest people have made their fortunes exclusively from real estate trading. Unfortunately, however, it’s not always easy to get started, especially if you don’t have the capital behind you to buy your first property outright. Before investing in the real estate market, it’s important to do your research, study, and learn about the economy.
This article will tell you several facts about real estate investment and the economy that will help you to become a better real estate investor:
Crowdfunding
As mentioned in this article’s introduction, it can be difficult to get started in real estate trading without being able to purchase one’s first property outright. Real estate crowdfunding is a rather new addition to the industry, but one that has proven to be very useful, particularly to investors who aren’t flush with cash. The idea behind real estate crowdfunding is that multiple people invest in a single property, allowing people to invest whatever is affordable to them. Crowdfunding is a very effective method of getting started in real estate investment. In today’s economy, where many people are unemployed, it’s a great way for people to make some extra cash with a small initial investment.
Rural Properties
At the moment, there is huge interest in rural properties. This is in part due to the fact that the pandemic put city life into perspective for many people. Being trapped inside large apartment buildings without adequate access to outdoor space can quickly become a nightmare if one’s movement is restricted. Rural property in California and Colorado are particularly desirable right now. If you hold any rural property, then now’s the time to put it up for sale. You could also rent it out as an Airbnb, which is also very lucrative. People are renting Airbnbs for all kinds of reasons these days, from vacations to workations, weddings and more. A lot of people even rent Airbnbs for bachelor parties.
Land Purchases
Many investors also recommend purchasing land at the moment, particularly in rural areas. As there is a huge demand for rural character properties at the moment, if you were to buy land and get the necessary permits for building a property, you could turn it into a very lucrative investment. If you are going to buy land and build properties on it, make sure that you buy it in an area that’s desirable with “Gen-Z” property buyers. You could also rent the land out to a commune or religious organization.
Property Renting
Unfortunately, the pandemic has caused many people to lose their jobs and their homes. There is a huge demand for affordable rental properties at the moment, especially in large cities. If you’re fortunate enough to own urban property, then you could consider renting it out to families or single people. If you are going to rent to the latter, then consider splitting your house or apartment up into individual rooms and renting the rooms out. You can also start listing your properties on sites like Airbnb to attract more customers. Renting rooms out is a very effective way of turning a single house or apartment into an absolute goldmine. Renting rooms out can yield as much as $1000 per room, per month.
Rising Prices
As anybody who is involved in the real estate market knows, there is a huge demand for property at the moment, and as one might expect, market prices are soaring. If you’re new to property investment, you might think that now’s the best time to buy but that’s not necessarily the case. If you hold on for a little while, analysts are predicting a slump. If you’re clever, you will buy during the coming slump, so that when prices rise again you make a massive amount of profit.
Property Competition
Another thing to know about the property market in its current state is that whatever you are investing in, you will have competition. It’s fair to say that unless you are buying privately from a friend or family, you will enter into a bidding war with rival property investors for a property. This is due to the shortage of property around at the moment, and the number of multinational corporations buying up land and property, like Blackrock. If you see a property that you like, don’t think that you’re going to get it for its market price. This is extremely unlikely in today’s economic climate.
Sparsity of Property
As mentioned in the previous point, another thing to bear in mind is the scarce availability of property at the moment. Investors are buying up property everywhere, so don’t be disheartened if you can’t find the perfect property for you immediately. It may take time.
Property investment, if done right, can be very lucrative. Take the information contained within this article into consideration and apply it to your investment strategy. This information will help you to make more informed decisions and make you a better investor.
