Planning on investing this 2023 but not sure just where to put your money? Maybe the stock market is a good bet. Or maybe a mutual fund. Or how about that rising condominium in Tagaytay? Yes, purchasing a real estate property is also an investment.
What Is Real Estate Investing?
Real estate investing is getting involved in the real estate business. Instead of real estate property for occupancy, it is to generate rental income either through residential properties or commercial properties such as buildings or retail space.
Real estate investments are one of the safest and easiest. Not only do fellow real estate investors state it as recession-proof, but also increases in market value over time.
This article will guide you to know where to look for real estate investors or how to start investing in real estate.
Guide to Investing Your Real Estate Property
Before looking for real estate investors, start with knowing which type of real estate investment you plan to venture.
Investment Property
Which real estate investment should you invest in?
- Residential – investment property where people live or stay like houses or condominiums.
- Commercial – office buildings, retail stores, company space for leasing, or small businesses.
- Industrial – property investment in warehouses or facilities for storage, or distribution of goods.
Types of real estate investing
Here are a few real estate investments available:
Buy and Sell
- You can choose to buy property, flip, and sell for a higher price. Although this requires more cash reserve.
- Make sure to check the cost for renovations with how much ROI you will receive after.
Buy and Hold
- Another real estate investment is buying and holding. People who do this usually just need to put their money somewhere.
- Instead of having to leave your property, monetize it into a rental property. That way, you won’t be leaving it since you still pay for its amortization.
- Rental property
- As with any other real estate investing, make sure to calculate how much your ROI would be including maintenance, fees, or mortgage.
- This would be applicable to students renting near their universities.
- As a landlord, you take charge of repair and maintenance. Your tenants should be the ones to report any property issues ASAP.
Real Estate Investment Trusts
- If you’re not too keen to buy properties or invest a huge amount of money in real estate, you can still be a real estate investor without physical investing.
- Real estate investment trusts or REITS are like regular stocks but invest in companies with commercial real estate.
- REITs are dividend-paying stocks so expect regular income.
Shared Owning Real Estate Investing
- If you plan on having a joint real estate investor or partnership, you can purchase property together under ‘joint tenancy’ or ‘tenancy in common.
- It requires having a real estate manager to make sure capital is evenly distributed. This avoids conflict on transparency and other conflicts.
- Make sure your partner is someone you can trust to handle and manage your rental property as well as its finance.
- Hiring a lawyer would also be advised to ensure your interests are protected.
- Co-op investment property:
- Co-op is a real estate investment that provides stable cash flow and tax benefits.
- This type of investing requires strong cash flow income for maintenance fees and that will allow real estate investors to have ‘voting rights.
- Co-op investing is not technically real estate investing but you can invest in companies or corporates that own property.
- Other benefits are entitled to use that property. You can also write it up as part of your business income which will make your taxes smaller every year.
You can always consult or talk with real estate agents to give you better insights, and suggestions, and guide you on which real estate investment you should invest.
You should also consult with a financial advisor to help build your cash flow which can add up to other investment opportunities.
How to Find a Real Estate Investor?
Advantages and Risks
Advantages
- Range of talent – Partnerships between property investors offer different ideas and perspectives. Not only those this help in decisions but also add a creative mix to
- Divided workload – Being a real estate investor may be difficult in the day-to-day task, so having a partnership can ease the workload and easily network for more connections in the real estate market.
- Combined resources – Real estate businesses like other investments require cash flow. Having a partnership can be an investment strategy since you can take more opportunities than you normally could in real estate projects.
Risks
While there is an advantage to looking for real estate investors, you should also consider the risks:
- Different work styles – Because of the creative range, opinions may differ and eventually come to some disagreements. If you’re looking for a real estate investment partnership, be open to working with different opinions and personalities.
- Uneven workload – If the task isn’t evenly distributed among real estate investors, one might feel overworked and deserve more credit. Make sure to come to an agreement on task division beforehand.
- Divided earnings – As a partnership, capital is shared. Be prepared for cash flow differences, especially during low or bad real estate earnings.
Where to find real estate investors
It’s important to diversify your network and connection when looking for real estate investors.
The real estate industry is wide after all, so it may be difficult to know where to look for interested real estate investors.
Listed below are some online and offline methods that offer real estate platforms to help you network.
Social media
- Social media has made networking easier and for free. Looking for real estate investors can be found on real estate investor websites, LinkedIn, or Facebook.
- You can use keywords that will help connect easier with people of similar interests. Like [real estate investors near me], [rental property investors], or [investment real estate].
- You can also network on Facebook groups provided that you check if they are not scams like any other online transaction. There are real estate agents or online brokers who also have Facebook pages put up.
- You can also create posts on Facebook stating that you are selling real estate and are looking for investors. This is common among rental properties.
Target Network
- Real estate investors do not always have to be outside your community. You can also find real estate investors among your peers, friends, or neighborhood.
- Create a target network by making a real estate investment portfolio.
- Whether you’re being specific on demographics or expected rental income, narrowing down your network would make it much easier.
Google Search
- Another method for looking for real estate investors is simple searches on Google, Bing, or other search engines.
- Key phrases or keywords play an important role in narrowing down your search.
- These real estate investors, however, may look for rental properties that are cash-based rental.
Crowdfunding Platforms
- Crowdfunding is another investment that most people are familiar with. it can also be for real estate investment.
- Crowdfunding real estate investments involve pooling or passive income from multiple investors.
- There are digital platforms that offer rental property crowdfunding for capital, investing, or fundraising like Indiegogo, SeedIn, or you can search around your local area for other platforms available.
Real Estate Directory
- You can also look into the real estate directory for professional real estate investors or real estate agents around your area.
- You can get professional help or network among those who are private investors.
Mortgage Lenders
- Mortgage lenders or money lenders for rental properties are angel investors you can find through banking.
- They offer quick capital among those flipping houses, real estate developers, and other real estate investors.
- The risk is higher compared to traditional lenders. While traditional lenders look into your personal information, these mortgage or hard lenders look into your personal finance or focused on your assets.
- So if you do apply, mortgage banks or hard lenders will be stricter in lending investments to a higher risk. You may also need to apply for a mortgage loan to generate startup capital or for real estate property.
Real Estate Investment Trusts
Investing in the real estate market can cost millions, but if you want to invest without a physical property, real estate investment trusts (REITS) is a real estate investment by indirect purchase.
Real Property
Now that you have an idea or have ventured as a real estate investor, you should also be aware of real property tax which is issued by the government.
Not all properties issue taxes, but as a property owner or property investor, you should be wary of legal rights and ownership as real estate investing involves high risks and large amounts of money.
Consult a professional real estate agent that you can trust to handle your rental property or for ideas in real estate investing, consider real estate brokers to consider your personal finance.
Investing in real estate may seem difficult at first, but just like other investments, learning always starts with taking initiative. If you are ready to invest in real estate or your real estate property, you can start with a space in your residential properties.
Condominium projects have increased in the country mostly after COVID-19. If you own a condo, that can be another easy rental income for you. Otherwise, check these condominiums in the Metro for your next purchase. Not only can you add it to your rental property, but they are also among the interest of real estate investors because of their convenience in location and demographics.
For instance, this condominium in Tagaytay is situated in CALABARZON which is one of the best places to invest in rental property. These real estate properties are ready for occupancy and offer gorgeous spaces for those interested in owning a rental property.
Related Blog: Investing in an Upscale Real Estate Property this 2022
