Is property a good investment? With well over 100 different ways to make money in real estate and the fact that it is one of the most stable markets, we would say, yes! Property is a good investment.
I love houses. I mean seriously, haven’t you ever seen one of those houses on a hill overlooking the bright lights of a city (say LA) and thought to yourself, that architect must be a descendant of royalty or divinity? Truth is, we all love a beautifully designed house.
But you see, people like me are still regular people who need to earn money. So what I do is combine my passion for houses to make money out of it. That is the only reason as to why I invest in real estate. Let it never be said that I was misleading. I am in this for the money. The fact that I get to own (buy and sell) some of the most gorgeous pieces of real estate is just a wonderful perk of my life.
Now, I understand – ever since that dreadful bubble, people have been a bit more than just a little skeptical when it comes to investing in real estate. Yes, like any other investment opportunity, there is some element of risk attached to it. But, honestly, without that risk, the money you make in real estate just wouldn’t be as exhilarating.
That being said, even though investing in real estate does have some risk, there is still serious money to be made in this field. If you are still looking for sure-fire ways of how to make money in real estate or are constantly asking yourself, “how can I make money” or “is property a good investment”, pull up a chair, let me tell about a few amazing ways through which I make money in real estate day in and day out.
How to make money in real estate:
The first thing you need to do is ask yourself in what kind of property would you like to invest in. You see, real estate is about much more than just houses. Here are your options:
Ever heard of ‘The Landed Gentry’? These were noblemen, who above all else, possessed huge tracts of land. And this made them ‘better’ than everyone else around them. Owning raw land still has that kind of clout. Not only is it an investment that will never go bad, but you can also subdivide it to make more money from selling it off piece by piece. Or you could wait until your local council earmarks your property for a development project and then charge them an arm and a leg for it. It is all in the location and research of the property you buy. Either way, this is an investment that can only appreciate.
Develop the property:
Once you have land, the best way to raise its value is to develop it. Some people choose to put up commercial buildings while others choose to put up residential buildings (either single homes of duplex/triplex or quads). Not only will you be getting rent from these developments, but you’ll also have financing options available to you. With your land as collateral, it becomes easier to secure financing from traditional institutions.
Another way to go is to develop industrial properties on your land. These include manufacturing plants, distribution centres, warehouses and so on. These are the kind of developments that hardly ever lay idle.
Granted, the first three I mentioned are only possible if you have a sufficient starting capital and contacts in the property development and building circles. What happens if you don’t have either of these? The good news is that it’s always possible to start small in real estate.
The traditional way is to buy semi-rundown properties, fix them up and put them back on the market with a favourable margin. The goal is to find low-cost properties so you can get in low, and then sell high. Remember, not all refurbishments need to be expensive. You just need to know which projects affect prices the most so you know which projects to prioritise.
The projected profits from these won’t be as big as when you own a piece of land. But even then, fixing and flipping just one property can net you as much as a year’s worth of extra income if done right. What happens when you do 2 in a year? How about 3? If that sounds too much, understand that seasoned investors who started out small are able to close 10 or more deals in a year – so it is possible to build your way up.
If you are interested in hearing stories about how ordinary folks are able to start their way in property investing, there is a nice Podcast I tune into hosted by Rick Otton, and these episodes focus on real life deals that aren’t out of reach for the average Jane’s and Joe’s. Nothing like good ol’ inspiring stories to keep you motivated!