Real estate investing remains one of the best ways to build wealth long-term, and one of the most approachable ways to start generating passive income. But to the average person, it appears intimidatingly difficult to get involved. How do real estate investors find the right deals? And what exactly do they do with their money? More to the point, how did they get started?
Once you get your foot in the door of real estate investing, you’ll have practically limitless possibilities for financial development. The question is, how do you get “into” real estate investing in the first place?
LEARNING THE BASICS OF REAL ESTATE INVESTING
The good news is, it’s easy to learn the basics of real estate investing (even if they’re hard to practice and master). Generally speaking, the idea behind real estate investing is to purchase whole or portions of physical property, then make money from that investment—either by collecting income produced by the property or by reaping the profits associated with property appreciation.
There are many different ways to invest in real estate, including:
Buying rental properties will help you generate income on a regular basis. You’ll make monthly loan payments and pay for the upkeep of the property and collect rental income from your property’s tenants. If managed properly, you can collect a small profit each month.
Other investors try to make long-term investments. They buy inexpensive properties in promising areas, hoping to increase the value of those properties over time.
In a riskier bid for faster gains, some investors try to “flip” properties by purchasing homes in need of heavy repairs, fixing them up, and presenting them fresh to the market.
COMMERCIAL AND NICHE INVESTMENTS
It’s also possible to invest in properties for commercial purposes, or properties in other niches.
It’s also possible to invest in properties indirectly. For example, you could invest in a real estate investment trust (REIT), a company that invests in and collects income from real estate properties. You could also contribute money via crowdfunding, as a way of investing in property with many other investors.
As you learn more about these methods, you’ll find one (or more) approaches that suit your needs in terms of risk, cash demands, and other variables.
REAL ESTATE INVESTING: KNOWLEDGE AND EXPERIENCE
Nobody can be a successful property investor immediately. To be successful, you need the knowledge and experience to choose the “right” properties to buy, and the right ways to manage those properties. The straightforward path to get this knowledge and experience is to acquire it on your own; the more time you spend investing and the more you’re willing to learn, the better you’re going to get.
But the easier and faster way to make use of this knowledge and experience is to get them through someone else. You can work with an organization that specializes in property investments, harnessing their resources, their team, and their experience to make smarter investments on your behalf.
You could also spend time networking and attending real estate investing meetups to find existing investors. Even making small talk with them can introduce you to new real estate investing fundamentals; if you’re looking for a more intensive, focused approach, you can try to find a mentor.
FORMING PARTNERSHIPS FOR REAL ESTATE INVESTING
If you’re new to the real estate investing game, you can form a partnership with a person or an organization to make your life easier, and introduce you to properties you may not have found or been able to manage on your own. For example, you could work with another individual who has lots of current experience in real estate investing, pooling your resources and dividing responsibilities between you. This can be risky, since you’ll be at least partially depending on your partner to do the work; but it can also limit your personal exposure to risk.
Another approach is to work with an organization like the GSH Group. The GSH Group is a real estate investment firm that acquires and manages multi-family properties, with a specific focus on the Midwest. Collectively, the GSH Group finds new properties and manages them on your behalf, sparing you the most time-intensive and knowledge-dependent efforts associated with real estate investing. All you’ll need is the capital to get started.
Learning From Your Mistakes
The most important skill you’ll need in the realm of real estate investing is the ability to learn from your mistakes. Because you will make bad purchasing decisions, underestimate expenses, and mismanage properties on your own. What’s important is that you take the time to learn why your mistakes were problematic, change your approach, and grow as an investor.
To avoid this, you can pursue real estate investing with the help of a real estate investment firm like the GSH Group. The GSH Group manages properties on investors’ behalves, with the expertise necessary to provide sustainable long-term returns.
Contact us today to learn more about our services, and how we can help you invest in real estate!