Real estate is one of the most popular areas to invest in, with people all over the world more likely to buy real estate than invest in stocks or other options. While the real estate market has changed a lot over the years, it still represents an excellent way to grow your money and build a portfolio. Houses and apartments are an important and in-demand commodity, and aside from buying them, they can also be rented out for profit. In addition, many banks often lend out large sums of money to allow investors to purchase properties, helping them build their portfolios faster, even without a lot of starting capital.
It’s these reasons why real estate is so popular to invest in, but there’s a lot to know before you get started. As with any form of investing, there are inherent risks involved. You can potentially lose money. If you’re taking out a mortgage to invest, it’s particularly important that you consider the risks carefully before you start.
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Education in Real Estate
Before you start investing in real estate, it’s worth getting the right education. These days, it’s easier than ever to find courses and guides online. It’s recommended that you take a course from a trusted provider. There are plenty of traditional schools that now offer online learning, which allows a more flexible course structure and lets you complete your studies around an existing job or responsibilities.
A course in real estate economics and finance will help you to critically evaluate property investment options and make informed decisions based on sound economic and financial theories and research. You’ll also explore sustainable real estate practices and their value, as well as fund management, which includes how best to fund the purchase of a property. This course is aimed more at those that wish to work in real estate and property management. However, you can find other courses that are made for those simply looking to invest.
An education in real estate will give you a better understanding of the principles of market structures and how these markets affect the real estate industry and the economy. It will also give you a clearer picture of how financial institutions affect the property market and the options available to real estate investors.
Options for Real Estate Investors
While you might think investing in real estate is simply buying a property and selling it once the value has increased, there are actually many different ways to invest in real estate. Here are some of the most popular:
Buying real estate investment trusts
A real estate investment trust (REIT) is the easiest option for those who want to invest in the real estate market. This allows you to invest in property without owning the physical property itself. These are often compared to mutual funds, and they are an investment in companies that own commercial real estate such as offices, retail spaces and hotels.
Invest in rental properties
Investing in rental properties can be an excellent way to increase your income over time and build your real estate portfolio. In this case, you buy a house or apartment, which you then rent out to tenants. Make sure that the costs of buying the property are lower than the rent, and be prepared to pay a property management agency a small fee unless you want to manage it yourself.
Online real estate investment platforms
Online platforms have become the most popular way to invest in stocks, and there are now many options for real estate investors too. You can use these platforms to invest in property development projects and gain monthly or quarterly contributions based on the risk you take on.