At a time where the economy is posing challenges for everyone, investments need to be chosen carefully. Off all the investment options, real estate is the one that retains its value and pays off well in the long term.
Real estate can generate income in multiple ways and it gradually appreciates in value as well. Rental yield is the percentage of yield from monetary gains from rent. Even during inflation, the rent increases and hence the income. With increased rental property value, sale and reinvestment is easy. Also, you can obtain a higher credit from mortgaged property.For those who are not thorough with other investment vectors, real estate investments can easily work. It’s not rocket science.
The good news is, you don’t need to pay for a property from your pocket. Leveraging is one good way of acquiring assets. A house loan is the most common option.But the most popular option, thesedays, is through real estate investment trusts or REITs. Real Estate Investment Trusts acquire commercial real estates. There are financial management teams who take care of these trusts. When purchasing REIT shares, you become part owner of the properties they manage, thus, being part owner of the real estate. Imagine if the REIT owns a skyscraper. This means you are a part owner of a skyscraper as well!
Just like stocks, REITs pay dividends and you can even sell of your share when it appreciates in value. The law requires REITs to pay their investors more than 90% of their profits. For example, if you want to purchase shares in Dallas real estate , look for REI trusts that hold estates in Dallas.
Another way to make money is through flipping houses. It involves buying a house, letting it appreciate in value and selling it for a profit. This require that you have cash to buy houses. Since the price of houses are market dependent, the business is very dependent on the economy. During a boom, it’s easier to sell a house but more expensive to buy one. During a bust period, houses are a bit cheaper however; properties may sit in the market for months before someone buys from you.
If you do not have enough cash, there is buying and selling on the margin. What you do is, get a loan, buy a house, pay interest, and sell at a profit when the time is right. Since you don’t have to put in your own money, you don’t need to have that kind of a money, but you must consider the risks before jumping in. You can learn about real estate deals and processes through online realtor sites. Check online web listings for Dallas real estate and Dallas realtors or where ever you want to buy property.
Source: http://nasdaqreportnews.com/2011/12/27/investing-in-real-estate-an-overview/
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