According to Brad Zackson, co-founder and director of development for full-service real estate company Dynamic Star, what comes to mind when you think of investing in real estate? Your house is undoubtedly one, but there are a variety of other real estate investments that don’t always include physical structures. Let’s examine some of the popular real estate choices and the reasons Zackson thinks they are appropriate for you:
Housing Prices Historically
Housing is an excellent investment since real estate values have traditionally increased over time. However, as the COVID-19 epidemic overtook the country in the spring of 2020, various housing markets across the U.S. suffered a little setback. However, when people’s trust in the housing market returned this year, property values hit historic highs.
Investment in rentals
Property that you rent to renters is referred to as a rental. you get payment from the renter. The funds you earn can be used to settle debts such as your mortgage, real estate taxes, and other bills.
According to Brad Zackson, you may benefit from the property’s value growth in addition to the income flow you receive from renting it out. This is one of the factors that attracts many individuals to real estate investing, particularly in rental houses.
Flipping real estate
Flipping homes refers to the process of purchasing and selling residences fast in the real estate market. Typically, the procedure is purchasing a home for a bargain, then reselling it for a higher sum.
Trusts that invest in real estate
A particular kind of real estate fund called a real estate investment trust (REIT) combines investor money to buy and manage real estate. Due to their tax benefits, REITs have grown in popularity as a direct real estate investment substitute in recent years. Investors should expect to see larger returns on their investments because they are specifically excluded from corporate income taxes. Compared to other real estate investment categories, REITs are quite liquid. RELPs are real estate limited partnerships.
REIGs are real estate investment groups.
People who pool their resources to invest in real estate form real estate investment groups. They are frequently established by investors who wish to combine their funds and divide the risks involved with purchasing real estate. Brad Zackson argues that while real estate investing is dangerous, you need have an experienced group of investors on your side.
REMFs (Real Estate Mutual Funds)
With very little starting money, real estate mutual funds give investors a chance to have diversified exposure to the real estate market. In comparison to purchasing individual REITs, investors can choose from a wider variety of assets by investing in mutual funds.