Across the last couple of years, we've seen a sharp drop in the prices of real estate. These changes mean that real estate investing doesn't work the way it once did - but they do NOT mean that you can't profit from it! There's still money to be made if you know just how to go about it.
Understanding the Basics of Property Investing
Real estate investing works just like any other form of business. The idea, whether in the stock market, the local grocery store or real estate investing is simple; you buy low and sell high to make a profit. The grocer buys his vegetables from the farmer at a wholesale rate. He pays the cost of transport, marketing, etc. and passes those costs on to the buyer with a slim profit margin built into each sale. Though he perhaps only makes a few cents off each sale, his business will succeed because he is following the basic business formula of selling products for more than it cost him to acquire them. This is what you also must do to be successful in any real estate investment.
Flip It!
Before the housing slump left hundreds of thousands of homes unoccupied and property was at a premium, one of the most lucrative real estate investing schemes involved purchasing buildings and houses that were in less than perfect condition and then restoring them. Often one was able to finance the purchase of these properties for no money down, making them accessible to the "average" person. Many people did most of the repair work themselves to keep costs low. Once the property was restored, it was put on the market and was usually purchased very quickly. The investor then paid off the loan and enjoyed a healthy profit in return.
Things Have Changed By Property Investing is Still Profitable
Money is a lot tighter these days and "flipping" just isn't as simple as it was. There are limited buyers, and banks, therefore, are much less likely to cooperate as they once would have. However, you can still make money, just go about it in a different way!
When people default on a mortgage, they still need somewhere to live. For those who want to get into property investing, with some cash and well established credit, opportunities exist to take advantage of this situation. Once you own properties, which are now available at low prices from the banks, you can attract renters who are now plentiful. Because housing prices are so low, the rent you collect will greatly offset the mortgage or even cover it entirely. As the housing market rebounds, as it eventually will, the value of the properties you own will rise and you'll enjoy a great amount of equity. You'll have the option to either continue to rent or to sell it on a rejuvenated housing market for a substantial profit.
Real estate investing isn't dead just because the market is weak. People need places to live and someone must own these places. Why not make that person you?
Are you new to the world of real estate investing, and want to know more about how to start? Or perhaps you want to keep up to date with the latest market news?? Visit our real estate investment resource today for everything you need to know.
Orignal From: Real Estate Investing in This Market: There is Still Money to Be Made!
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