4 Best Investing Strategies for 2016
Regardless of the season, real estate is an ideal investment one can make. Whether you plan to invest in a real estate property, it is an achievement you can make in life. With the right strategy and qualification a home investor should have, then real estate investment is within their reach. While some people are planning to have and live in their dream home, others opt to have it as a generating income.
But whatever the reasons are, there are certain things to consider before you can have a desirable outcome. When it comes to purchasing a property, committing costly mistakes is a no-no. That means you have to be mindful of each transaction to prevent such headaches. And to give you some ideas, below are some best-investing strategies you can do.
1. Real estate trading
Real estate trading is way different from the buy and rent investor. It is a sophisticated side for real estate investment where traders buy properties with the intention of holding them for a short period of time (no more than three to four months) and sells them for a profit. This is one of the real estate technique called flipping properties that is based on buying properties that are in a demanding market.
2. A basic rental property
Many home investors opt to have a basic rental property. It is an old practice of land ownership. That means a person will buy a property and rent it out to a particular tenant. It is the owner or landlord who is responsible for paying the mortgage, taxes, and costs of maintaining the property. A landlord charges enough rent to cover all of the expenses a property can have. That means he/she must know the market value to prevent any miscalculations of the rent
When it comes to real estate investment, an investor has one tool that is not available to stock market investors – and that is the leverage. If you want to buy a stock, you have to pay the full value for the stock price to place the purchase order. Moreover, the amount an investor can borrow is still lesser than with the real estate, even if you are buying on a margin. If you have leverage, your mortgage will eventually pay the total value of the house at the time you purchased it.
4. A real estate investment trust
A real estate investment trust (REIT) was founded when a corporation uses the investor’s money to purchase and operate income properties. REITs can be a little tricky. They are typically bought and sold on the major exchanges just like any other stock. Unlike regular companies where they would be taxed its profit, REIT avoids paying corporate income tax to keep its status.
There are a lot of real estate strategies you can use to achieve a desirable outcome. That means, you just have to be mindful of what strategy to use for you to prevent any costly mistakes later on. Moreover, if you are a first-time home investor, it is better for you to consult a real estate professional to help and guide you with your investments.
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John Lee is a blogger and a real estate enthusiast. He Currently writing and blogging about Arca South Taguig,a highly networked central business and real estate company in the Philippines.