Monday, November 1, 2021

6 Tips for Making Money and Building Wealth in Real Estate

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Money, real estate
Tips to making money in real estate

Building Wealth in Real Estate

When it comes to real estate, investing is one of the most popular ways to make money. Many real estate investors become wealthy through real estate grants or loans, but it is not always easy to make money in real estate. However, real estate wealth is possible. If you are looking for ways to invest in real estate, check out these 6 tips to make money and build your wealth through real estate.


6 Tips for Making Money in Real Estate

1) Airbnb

You buy real estate, and you rent it. And you make money for doing nothing.

This is real estate investing with Airbnb, a peer-to-peer online rental marketplace that is leading the sharing economy charge. The company was recently valued at $75 billion, making it one of the most valuable companies in the world.

The real estate investment opportunities with Airbnb are growing every day. While real estate investors and realtors alike debate about whether or not online rental websites such as Airbnb will impact real estate markets for better or worse, there is no arguing that real estate investing with Airbnb can be an extremely profitable money-making venture if done correctly.

Airbnb , real estate
Staging your Airbnb before you photograph

Maybe you have already tried real estate investing with Airbnb and aren't seeing the results you want. If that's the case, real estate investing with Airbnb might just be a little different than you are used to. Read more about how you can list your Airbnb for more money!

2) Fix-and-flips

Fix-and-flip real estate investing is another real estate investment opportunity that you can do with very little time, money, and effort. The idea of a fix-and-flip is to buy a property at a lower price than the market value, then invest in the renovation until it reaches its total potential value. This can be done alone or with partners, but either way, this investment strategy is one of the easier ways to make good returns on your money.

Renovate house
Invest in the renovation

While this is a simple concept, the actual execution often requires a lot of knowledge and hard work to ensure that profitable fix-and-flip real estate deals.

To decide if fix-and-flip real estate investing is right for you, ask yourself the following questions: 

  • Are you able to take risks?
  • Are you willing to put in the blood, sweat, and tears required in fix-and-flip real estate investing?
fix and flip homes
Are you willing to put in the work?
  • Are you willing to learn new skills?

If you can answer yes to all of these questions, then fix-and-flip real estate investing may be the real estate investment for you.

Fix-and-flips can range in risk, but typically, the riskier the flip, the higher your return will be. The challenge with fix-and-flip is that they take a lot of time and effort to complete. This means if you are looking for passive income, then investing in fix-and-flips is probably not going to be what you are looking for. But, if you have a lot of free time and a love for renovation, then fix-and-flips may be the real estate investment you are looking for.

3) Wholesaling real estate

Wholesaling real estate is real estate investing without the burden of maintenance or management. What you need for wholesaling real estate is the ability to spot a deal and negotiate a contract. Once you have done that, the real work begins.

You must get the deal under contract and wait patiently for your potential seller to find a buyer willing to pay their asking price.

The more deals you take under contract, the more money you stand to make. But don't forget, it's not as easy as just finding a deal and putting it under contract. A lot of hard work goes into closing and selling off wholesaling real estate deals, but the harder you work, the better return you will make on your investment.

4) Buy-and-holds

Real estate investing with buy-and-hold properties is one of the most common, well-known types of real estate investment. There are a lot of different strategies surrounding buy-and-holds, but the idea is simple. 

Buy a property at wholesale prices and hold onto it until the market conditions are right and you can sell it at a profit.

via GIPHY

It's not as easy as that, of course. 

There is a lot that goes into buy-and-hold real estate investing.

  • You have to find suitable properties,
  • negotiate low prices, 
  • make sure you are recruiting high-quality tenants, 
  • and be ready to take on the challenges of property management.

The idea behind buy-and-hold is geared more toward passive long-term investment, instead of short-term, in which the investor relies on time to make money by itself. Many legendary investors, including Warren Buffett and Jack Bogle, have praised the buy-and-hold technique as being perfect for those seeking long-term financial success.

5) Real estate crowdfunding

The real estate crowdfunding industry is a relatively new type of investment. Crowdfunding is done by using an online page to connect accredited investors with potential real estate investments.

Several different companies are offering this service, but they all work similarly. An investor will review deals on a crowdfunding website and decide to invest in a specific project. If they choose to invest, the investor makes a pledge.

After an investor has made their pledge, funds are electronically transferred from the investor’s bank account to an escrow account to ensure the funds are not misappropriated. The money is then used to purchase property, and the investor gets a percentage of equity in the deal.

Real estate crowdfunding can be a great way to invest in real estate for some people, but you must understand that it is not perfect and comes with its own set of risks.

6) Commercial real estate

Commercial real estate investment can be a great way to make money in real estate and develop your real estate wealth. 

Commercial real estate
Commercial real estate

The main difference between commercial real estate and residential real estate is the purpose of renting the space. Commercial real estate, such as office spaces and retail stores, is usually rented out for long periods.

There are several different commercial real estate investments, including 

  • retail, 
  • office space, 
  • and industrial.

Commercial real estate can be more expensive than residential real estate, but it is generally worth the investment.

Author: Laura Alamery is a nationally known, expert real estate investment coach with over 30 years of experience and success. She has guided her students through the years of recessions, layoffs, divorces, and more. Her coaching and real estate investing strategies have proven to be successful and lucrative, creating monetary freedom for the lives of her students.

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