Real Estate Investing – 4 Types Of Strategies
Real estate consists of real property including the physical buildings and land on it, and its accompanying natural resources like water, minerals or plants; and an additional interest vested in it, for the full value. In today’s market, real estate investments are growing and a good realtor can help you identify an investment property that fits your investment strategy. Real estate brokers are professionals who make their living by helping buyers locate the right real estate property that suits their investment goals. They usually work with sellers of real estate properties and serve as intermediaries between the seller and buyer. A real estate broker can also help the buyer find a property suitable for them, in terms of location, price and amenities.
Some people prefer to invest in real estate investment through a rental property. The rent they collect is their portion of the profits. This is one of the easiest ways to invest in real estate. Rental property investing is ideal for individuals who have spare cash but would still want to earn some profit from their investment. With a rental property investment, you get the comfort and convenience of being your own boss but don’t need to worry about managing the property, maintaining the house and looking after the tenants.
Buying real estate with the objective of making a profit involves buying residential or commercial buildings that are not permanently attached to any property. These kinds of real estate investments are termed as ‘permanent fixtures’ in real estate lingo. There are two categories of permanent fixtures – ones that are permanently attached to another building or ones that are designed so that they cannot be permanently attached to any other structure. Permanent fixtures include apartment buildings, condominiums, townhouses, row houses and private residences.
One of the main types of residential real estate market includes fixed rate loans. Fixed rate loans allow investors to borrow a set amount of money over a certain period of time. The loan amount is set for a definite term which can be thirty years, fifty years or a lifetime. Residential real estate investors can make money by choosing to pay monthly or annual payments until the entire loan matures.
Commercial real estate investing is very popular and lucrative type of investment. In this type of investment, investors use their money to buy and sell real estate properties. There are four types of commercial real estate investing strategies. These include lease signing, contract purchase, landlord-tenant agreement and owner-user. Each of these four types has its own advantages and disadvantages.
The first strategy to invest in commercial real estate is lease signing. This type of strategy is suitable for those who intend to use the space for business purposes. This type of strategy works well for investors who do not possess the required funds to buy the property. They may just rent it out in the long term for a profit.
Contract purchase is another way to invest in real estate. This is a good strategy if the buyer does not have the necessary funds to buy the property outright. In case of permanent attached land, they may have to use their own money in order to buy the real estate. Permanent attached land can be used for different purposes such as agricultural land, recreational land or a piece of residential land.
The last two main types of strategies are owner-user and sewer systems. The first strategy is used by people who need to use the land for both residential and commercial purposes at the same time. The sewer system is used by people who need a septic system for their dwellings or business premises. It’s important that investors know the main types of real estate investing strategies so that they can invest accordingly.