10 Ways to Invest in Real Estate without Buying Property

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Buying property can sometimes prove to be too expensive a venture, putting off most interested investors. It’s barely a decade since the infamous subprime mortgage crisis that left scores of property owners devastated, and the question remains as to whether owning property is indeed the way to go. There are ways through which you can be directly involved in real estate without necessarily owning property yourself, and it’s a well-paying move.

In this article, we dive into 10 ways through which you can invest in real estate without having to buy any property. The options are diverse, terms are different, and so are the returns.

#1. Real Estate Investment Trusts (REITs)

Real Estate Investment Trusts earn their income through either owning or financing income-generating real estate. Some of them may have interests in both residential and commercial property while a few specialize on either. Majority of them are equity REITs trading in actual property while a few engage in mortgage-only structures. The profitability of your investment depends on whether you take time to research on the most promising REITs before buying shares.

#2. Real Estate Mutual Funds

Real Estate Mutual Funds are a little different from Real Estate Investment Trusts in the sense that whereas the latter is an actual company, the former is a pool of investments overseen by a dedicated investment manager. The freedom is within the investor to go with either income-oriented or growth-oriented investments. However, while mutual funds are tasked with risk mitigation, they still face the real estate inherent risks since if one of the investments gets affected negatively; the entire pool feels the impact.

#3. Real Estate Exchange-Traded Funds (ETFs)

Exchange-Traded Funds are a little complicated and it takes some professional advice to indulge fully. To understand better, REITs invest in real estate whereas ETFs invest in REITs. The argument here is; buying property or investing directly in REITs is riskier compared to investing in ETFs, but the ROI is significantly less. This is an option for investors who are afraid of taking risky businesses and are looking for less-involving investments.

#4. Online Real Estate Management Platform

An Online Real Estate Management Platform is somewhat structured like a stock, whereby investors pool resources together as part of crowdfunding. This enables interested investors to purchase property without necessarily having the capital. However, this is a form of investment best suited for persons with surplus money, considering buying large property requires huge chunks of money. It’s just not the investment for anyone.

#5. Real Estate Service Companies

You may choose to invest in one of the many companies working directly in real estate. Look around and you will come across companies selling homes through real estate agents. Real Estate Service Companies are not involved in buying property and will enable you to diversify your investment portfolio and give you a good feel of the current market. For the best returns, look at different company profiles and see which ones rank better. Typically, the best ranking service companies are popular and enjoy a larger market following.

#6. Wholesaling Real Estate

Somewhat related to flipping homes, but wholesaling houses does not involve owning homes or fronting maintenance costs. It simply means selling a property on behalf of the property owner for a profit, but terms are dictated by a pre-contract agreement. The best part is that you are not required to put your own money on the investment, but you will find it a little challenging finding an undervalued house that you can sell at a profit.

#7. Real Estate Partnerships

Investing in profitable real estate does not come cheap; it does require exorbitant amounts of money to get it up and not everyone can be able to afford it. If it involves like-minded partners, the burden reduces considerably and it becomes easily manageable. Partnerships thrive in real estate because partners share responsibilities. Terms are agreed upon where each partner is tasked with handling a specific responsibility. This way, it becomes easier and you could find yourself investing in a real estate without hands-on involvement.

#8. Real Estate Agent or Broker

Becoming an agent or broker of real estate requires some training because it involves putting together a set of skills for a successful venture. Your marketing and management skills will be put to test so before you decide to venture into real estate agency or brokerage, it is prudent that you get yourself acquainted with the demands. Notwithstanding, this is one of the best paying investments due to the commissions involved, and depending on the number of properties you manage, your star can only shine brighter. Real estate brokerage also requires more extensive training and trading licenses.

While becoming a real estate agent or broker is a great opportunity, it is also a position that many people fail at. Click here to find out why so many real estate agents fail.

#9. Real Estate Appraiser

If you have ever considered being employed in the real estate industry, this could be the job for you. People are taking home handsome paychecks from being real estate appraisers according to the Bureau of Labor Statistics. An appraiser may go residential or commercial to determine property value, taking into account a number of factors like projected property appreciation, surroundings, and even business potential among other factors.

#10. Home Construction Firms

The need for new homes and business premises will always be there for as long as the human population keeps growing. Companies involved in the construction of homes have been making huge profits for the longest time now, a trend not likely to change anytime soon. It is one way of getting yourself into real estate and earning yourself significant profits depending on where and how you put up these houses. The only downside of this form of investment is that you will need large capital to get started. If you can secure a loan to get the wheels rolling, it’s a risk worth taking.

Conclusion

The question of whether or not the subprime mortgage crisis changed the narrative of real estate investment remains in the minds of potential investors. People will be differently opinionated and diverse views will be shared. However, regardless of the hullabaloo, real estate is not an investment that is bound to die anytime in the future. All forms of potential investments involve immense investment in terms of research and option evaluation, and this one is no different. It will have its ups and downs, but it is still a great investment opportunity. Do your homework well, speak to a few individuals, seek advice from professionals and do the right thing at the right time.

Check out this website for information on how to invest in real estate with little money.

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