Real Estate Investing 101
When you invest in real estate, your goal is to put money to work today and make it grow so you have more money in the future. You have to make enough of a "return", to cover the risk you take, taxes you pay, and the costs of owning the real estate investment such as utilities and insurance.
When you invest in real estate, there are several ways you can make money:
Cash Flow Income - This type of real estate investment focuses on buying a real estate property, and operating it so you collect a stream of cash from rent. Cash flow income can be generated from well-run apartment buildings, office buildings, rental houses, and more.
Real Estate Appreciation - This is when the property becomes more valuable due to a change in the real estate market or upgrades you put into your real estate investment to make it more attractive to potential buyers or renters. Real estate appreciation is a tricky game and is riskier than investing for cash flow income.
Once you understand the basics of the game, real estate investing really can be as conceptually simple as playing monopoly. Your goal is to buy properties, avoid bankruptcy, and generate a return so that you can buy even more properties. But "simple" doesn't mean "easy". If you make a mistake, you could find yourself broke or worse.
When you are ready to start the process of real estate investing, you will want to decide which of the real estate investment types is most appropriate for you and how to execute your vision. To help you understand the options and create an effective plan, contact us for a consultation here and we can discuss what’s best for you.