Financial planning and investment is all about finding out where to invest your money so that you can get the best possible returns. Real estate investment has always been considered as safe because seldom the demand for real estate witnesses a dip. Property investment is the safest and there are strong reasons as to why it is given priority than other forms of investments like mutual funds, bonds, stocks and ETF. You can literally grow your money through property investment with minimum risk.
Investors skittish of stock market investments prefer to invest in the real estate market but there are many who have not yet got over the 2008 downturn. Scars of those days have not yet healed for many and they are not ready to invest just for the sake of property investment. They need strong and logical reason behind this investment; they prefer to wait it out rather than put in all their money hastily.
If you take property investment decisions in haste, chances are high that you will end up with something in your portfolio that would fail to produce the desired ROI. In HULT PRIVATE CAPITAL property investment, only four different routes prevail; however, here we are going to look at only two of the most popular ones.
First: You can go ahead and invest in a rental property
Second: You can buy shares in the REIT or real estate investment trust
Buying the rental property is quite straightforward method wherein you buy a rental property and give it out on rent. However, this type of investment is not for everyone as many fail to juggle their professional lives and at the same time upkeep a property like a landlord. It takes a lot of time and effort to maintain the property you buy unless you are using the services of a management company. You can obviously use the services of a management company but be ready to take a cut in your profits.
On the other hand if you invest in REIT, you don’t have to actually own a property on the ground and go into the landlord-mode. It operates just like a mutual fund and the only difference here is that it is property investment. The trust is a group of investors who make property investment and lets the individual investors buy its shares. The trusts are able to receive tax benefits as they pay a major chunk of their income to their shareholders. You can buy shares on public investments, which implies that your investment is quite liquid. You are ensured of regular dividends.
Two other methods of property investment that are often used by investors include notes and croudfunding portals.
Notes – You will be able to invest in second mortgages, paper notes etc. You can even sell or buy notes just like other real estate invest estates. The best thing is that there are no brokers involved in this.
Crowdfunding Portals – Many people with similar investment interests can come together to fund real estate investments. This is a new form of investments and is being tried out by some.