You can pay a small portion of the property’s value upfront and then cherish the capital growth and interest rate appreciation. You will notice profit and potential in your investment and can land a lifetime deal to benefit you.

People often think getting into real estate is hard. But in reality, it is as easy as applying for a mutual fund - yes, even for people investing for the first time. It can help you diversify your portfolio and end up with more streams of income.

It can give you stability and security along with the power to sell at any time. The mistake people make sometimes is investing in the wrong places or using the wrong methods to invest. Here are some simple ways to get started:

#1 Know the basics of house hacking

This is not illegal, don’t worry! It is simply a situation where a real estate investor buys a property but rents it out to tenants. For example, imagine you buy a rental property that has four rooms and choose to stay in any one of them. You can rent out the other three rooms to other people and gain an income from it.

You can either buy a rental property and rent it to someone else or you can stay in the property and rent out a unit of it. It will reduce the amount you should pay for the property if you are on rent and you can cut down on property tax.

#2 Make use of online portals

You must have come across several investment platforms for real estate online. They connect borrowers to investors and ensure that the process is authentic. You can eliminate the need for a middleman and do a background check of the parties involved before connecting with them.

The catch is that these platforms are often open to accredited investors and you will need to invest some money initially. If budget is an issue for you, this might not be the best first step.

#3 REIGs - Real Estate Investment Groups

Suppose you wish to own a rental space but don’t wish to engage in running it, REIGs will be your best friends! These are similar to having mutual funds while investing in real estate rental properties.

You might need capital investment and financial support while getting started (just like the online medium). In such a setting, the company buys an apartment complex and allows investors to purchase them via the company. You join the group of companies and don’t directly own the property.

The company will handle maintenance, advertise any vacancies available, and receive a percentage of the monthly rent. This means that as an investor, you need not interview your tenants or handle their grievances. You simply receive a stable income and possible appreciation when they pay the rent.

#4 REITs - Real Estate Investment Trusts

These might sound similar but are quite different. They are investment trusts and will enable you to invest in a non-physical form of real estate. Consider them to be companies that own real estate properties such as office spaces, hotels, retail spaces, and so on. These are commercial properties and could also be apartments.

They pay high dividends and it is better if you opt for publicly traded ones. These are REITs that you can purchase through brokerage firms. The best part is that they will help you loads if you are retiring. Imagine getting income from an additional source even after you have retired!

#5 Consider house flipping

This will require capital like the previous cases as well as some experience in marketing and renovation. If you are familiar with these and valuation for real estate, you can flip your properties often. Investors will get quick returns and can tie up their capital for a shorter period.

Real estate flippers are on the lookout for profitability and the perfect time to sell. Once it arrives, they sell the undervalued properties within six months. To ensure that you don’t fall prey to mortgages, you can buy a cheap property and increase its price by renovating it. This way, it will cost more when you sell it in the long term.

Summing up

The best properties will serve their investors and help them earn (in interest even)! By buying the right properties and appreciating their values, you can leverage them to earn a stable income. You can earn an income even after your retirement and indirectly manage your properties through REITs and REIGs.

You can pay a small portion of the property’s value upfront and then cherish the capital growth and interest rate appreciation. You will notice profit and potential in your investment and can land a lifetime deal to benefit you.

To know more about real estate investments and what simple ways you can use to get started, click here.