.png)
One of the best long-term investments you can make is real estate. While homeownership is a popular beginning point for many aspiring investors, there are several forms of real estate investments to consider.
Real estate investing is divided into four categories:
- Residential (buildings that house people)
- Commercial (spaces in which businesses operate)
- Raw land (undeveloped property)
- Third-party (investments into crowdfunding deals, investment trusts, and so on)
- Let's focus on residential real estate investing.
1. Peer-to-peer lending
Peer-to-peer lending can be an attractive choice, especially if you want to help others. This type of investing is allocating funds to people or projects that you strongly believe in, such as assisting someone in purchasing a home or making big repairs to a property.
2. Crowdfunding
Crowdfunding, like peer-to-peer lending, entails a group of people contributing to a common goal.
3. Real estate investment trusts (REITs)
You can look at a REIT as a way of niching down in real estate investing. Trust acts as a company that focuses on a specific type of income-producing real estate — such as hotels, apartment buildings, senior housing, and so on.
4. Fix-and-flip homes
Find a house that needs work, buy it for a low price, fix it up, make it attractive, and then sell it for a profit.
5. Short-term rentals
Maintaining a second (or third) house as a short-term vacation rental can be a profitable investment, with companies like Airbnb and Booking.com offering different options to typical hotel rooms.
6. Long-term rentals
Tenants who sign long-term leases are classified as long-term rental properties. One of the most common real estate investment strategies is to become a landlord.
7. Rent-to-own lease options
While renting-to-own (RTO) isn't always the greatest approach for a buyer, if you have a house to sell, engaging in a well-structured lease agreement that allows your tenant to buy can serve as a sort of real estate investment.
8. Buying and dividing the land
Subdividing land necessitates a high level of competence because it entails purchasing enormous swaths of undeveloped land and then dividing it into individual saleable portions.
Real estate is a financial and time commitment. There are several paths to real estate investing, whether your goals are short-term, long-term, or a good mix of both.
Got more questions about investment properties in Southwest Florida? Click here to send me a private message today.