Image by: Moyan_Brenn
By Theresa Grant
I?ve heard of tons of women that have turned investments into empires. I also hear a lot more women talking about how they made tons of money by investing in real estate. So this article is for you since you?ve opened this article.
HOW DO YOU START?
Well, the best way to start investing in real estate is to turn to the internet. There are tons of educational materials online that will go through all of the zoning laws and everything you need to know about real estate. There?s not enough time in the day or the amount of space I can write for this article that will allow me to give you all the basics of real estate.
So instead of giving you a step-by-step, 1,000 page novel about how to invest in real estate, I?m going to give you 3 ways to make money in the real estate industry.
Primary Ways Investors Make Money In Real Estate
- An increase in property value
- Rental income collected by leasing out the property to tenants
- Profits generated from business activity that depends upon the real estate
Overall, these are the top ways of making money. Now, of course there are other ways to make money that aren?t as popular are a little more hands on (flipping houses), but this is how to make an adequate amount of money 99% of the time. Plus, it?s more fun getting paid to get a mani-pedi!
1. An Increase In Property Value
To be honest ladies, property values do not always increase, which is starting to not be the case anymore. It has been for quite a few years since the housing market crashed but now it?s a buyers market and time to make those investments. Think of it this way ladies. If you own a $500,000 piece of land and inflation is 3%, you can sell your land for $515,000 but did you make any money?
No. Unfortunately, the government has to create more money because they spent more than they took in. It could have even got us a nice Tiffany?s diamond necklace, but instead, the government went further into debt than we will ever see in one day.
A savvy way to make money in the real estate game is to take advantage of what comes around once in a blue moon. When the inflation rate projected to exceed the current rate of long-term debt, you might find people willing to gamble by acquiring properties, borrowing money to finance the purchase, and then waiting for inflation to increase. That way, they can pay off the mortgages with dollars that are worth far less.
2. Rental Income
I?m sure a six or seven year old could run this exciting game of monopoly. If you own a house, apartment building, an office, or any other kind of real estate investment, you can charge them rent for wanting your space. I could even do it in my sleep. I just need to make sure that my property manager is happy and taken care of. As long as that happens, he/she will take care of my property and the tenants. I don?t need to do any paperwork, no headaches, nothing. That?s the beauty of this kind of investing.
There is also a special ratio that we use in the real estate game called the cap rate (which is a special financial ratio). If a property earns $100,000 per year and sells for $1,000,000, you would divide the earnings ($100,000) by the price tag ($1,000,000) and get 0.1, or 10%. That means the cap rate of the property is 10%, or that you would earn an expected 10% on your investment if you paid for the real estate entirely in cash and no debt.
3. Real Estate Business Operations
The final way of making money from real estate investments involves special services and business activities. If you own a hotel, you might sell on-demand movies to your guests or allow them a certain time limit on a gaming console. If you own an office building, you might make money from vending machines and parking garages.
These types of investments almost always require sub-specialty knowledge; e.g., there are men and women who spend their entire career specializing in designing, building, owning and operating car washes. For those who understand the intricacies of a particular market and rise to the occasion, the opportunity to make money can be endless.
These are the 3 main types of how to make money in the real estate game. The market is recovering as we speak, but there?s not necessarily going to be a boom just yet. 2013 is a good year to get your feet wet in the market, especially if you are new to the game. It?s the calm before the storm. Real estate numbers are forecasted to increase dramatically over the next 5 years or so.
Renting prices may only increase slightly, since it is still just a cheap (if not cheaper) to own than it is to rent. So landlords and investors looking to make extra income that way may not see a major improvement over the last few years. Overall, the market is slowly recovering. It?s just a matter of time before a boom happens. Our job is to prepare you for that day in the coming years and to show you the pros of real estate investing.
Did you enjoy this article?
|
Source: http://www.grandascent.com/2261/3-ways-to-make-money-in-real-estate/
rough riders joy division norco rand paul detained asexual jim carrey san francisco chronicle
No comments:
Post a Comment