Investing is one of the best ways to grow your wealth. You can invest in stocks, non-fungible tokens and other equities but none of them come close to investing in real estate.
But every investment comes with its own risks and buying a property to sell at a later date is no different. While they have the potential to grow, there’s also the possibility that they might not yield favorable results.
In this interview with Venture Capitalist Ryan Hoggan, we’re going to discuss the types of properties to avoid in order to maximize the potential for growth and the ability to make profit from real estate.
What is real estate investment and how does it work?
Real estate investment is a process which involves the purchase, rental, ownership, management or sale of a property to make profit. There are many techniques you can adopt to make money where real estate is concerned but the basic concept is that the property you buy must increase in value in order for you to make any reasonable profit.
What should you look for when you want to invest in a property?
Real estate investing has many advantages. In addition to the increase in value of the property you have acquired, the cost of maintaining the property must not be higher than the increased value. If it is, then you’re suffering a loss and the investment is not really working well.
There are several real estate strategies you can use, and most investors use strategies that go along with the type of profit they expect from the property, whether it’s a quick or long-term profit.
Are there different types of real estate investment and what are they?
Yes, there are! By understanding the future of real estate, you’ll be able to get a grasp of determining which investment will yield better ROI.
A lot of people just think that getting a property and renting it out is the best way to invest real estate but in the real sense, there are other ways to invest in real estate and get a good return. This includes a long-term property rental you buy for the sole purpose of renting out to other people as well as commercial real estates.
The former includes residential areas and the later includes non-residential areas such as hotels, offices and warehouses.
Are there properties you should avoid?
Yes! If your plan is to make profit, then there are some properties you need to avoid. Generally, these properties will either not yield profit in the long run or maintaining them will cost more than the amount you’re likely to gain from them.
What are the properties you should avoid?
There are some things that you should not ignore when you’re about to invest in a property. They make the difference between making profit and ending up without one.
An example is buying a house in a terrible location with high crime rates and a bad economy. You should not ignore the location because the house is good. Unless there’s a total reform of the area, you may not be able to make as much profit from the house as you ought to.
Another example is buying a property with no rental income.