Real estate is one of the best ways to invest. It can be a great long-term investment, a source of additional passive income, or your entire earnings for the year.
Basically, it’s a flexible way to make cash however you feel comfortable.
Are you looking to start investing in real estate in 2020? Here are five different ways to do it:
Fix and flips.
If you’re the hands-on type, fixing and flipping properties is a great way to make some money. You just buy some high-potential foreclosures or bank-owned properties, put a little cash and elbow grease into it, and sell the home at a profit.
Just be careful what you pay for the property from the get-go. If you want to ensure returns, experts recommend spending no more than 70% of the after-repair value (minus renovation costs) to safeguard your bottom line.
Want more consistent income? Consider becoming a landlord. You can buy low-cost foreclosures and other properties in high-demand areas, spruce them up a bit, and rent them out to long-term tenants. Be prepared to do some maintenance and repairs for your tenants though — or plan to hire a property management company to do it for you.
REITs, real estate stocks, ETFs, and mutual funds.
If you’re familiar with trading on the stock market, pivoting into real estate investments is easy. Just like buying a stock or bond, you can purchase shares of real estate investment trusts (REITs) and real estate stocks, exchange-traded funds, and mutual funds all through your brokerage or broker. You can also use them to boost the dividends on your IRA or 401K retirement accounts.
Crowdfunded real estate deals.
Forget Kickstarter. A new wave of crowdfunding platforms has emerged that lets you invest in real-life, profitable real estate developments across the world. Just a few options include Fundrise, CrowdStreet, and Cadre. On some, you need only $500 to get started.
Short-term rentals from your home.
Want to start small and with lower risk? Open a short-term rental out of the property you already own. Rent out a room or your garage apartment on Airbnb or VRBO. Get used to hosting, managing the property, and dealing with the expenses and cash flow, and slowly work your way up to full-term vacation rentals. With enough properties in the right locations, it could mean serious earnings over time.
Ready to Invest in Real Estate in 2020?
Are you ready to start making some extra income through real estate investments? There are tons of ways to do it. If fix-and-flips or managing a short-term or long-term rental property are up your alley, we can help. Check out our foreclosure search tool or browse our list of home auctions and bank-owned properties to find a great deal.