Real estate can be a successful and profitable investment for many people. Real estate owners and investors can use leverage to obtain new properties, allowing the to become home flippers or landlords by maintaining a mortgage on their investment properties. This means that even Pennsylvania investors who are starting out small can begin to build a significant portfolio in the real estate industry.
Become a landlord with rental properties
Some people become landlords almost accidentally, when they rent out their old home rather than selling it or inherit a property from a family member. You can also make a decision to go into the rental business, which provides regular income even as the value of your property grows. However, there are significant maintenance costs involved, and you also must deal regularly with tenants.
Join a real estate investment group
These groups help people enter transactional real estate investment without actively managing the property. In essence, being part of an REIG is like investing in a mutual fund for real estate. This may require more up-front capital than being a landlord but has fewer risks associated with maintenance and vacancies.
Become a house flipper
As a house flipper, you will buy homes on the market, renovate them and put them up for sale. House flippers require a significant amount of capital as well as renovation abilities, and they do best in a relatively hot real estate market. Some house flippers may simply find an undervalued property and put it back on the market at a higher price without altering the property. This can offer quicker returns but also requires strong knowledge of the market.
These are not the only ways to get involved in real estate investing. You can participate in a real estate investment trust as part of your brokerage portfolio, and these can be very profitable. Look into these options to learn more about entering the real estate investment field.