Which Investment Strategy is Right for You?

Posted on April 13, 2016 by

There are a few investment strategies you may want to take a look at if you are about to take the leap of investing in real estate. Especially since about forty percent of all homes in the first quarter of 2015 were sold to investors. 2016 is shaping up about the same. Truly, this is a huge portion of homes sold and having the right strategy can make a world of difference when it comes to the kind of profits you can earn.

First though, we have to take a valuation first approach to every transaction. Knowing the true value before you buy is huge. One of the most common investment strategies using real estate comps by REIAComps some investors are accustomed to is ‘flipping’. This is a way you can make a very quick profit. If you see you can get a property rehabbed quickly and move on, flipping is ideal. Frankly, if quick profits are what you want, then flipping can be the way to go.

Another investment strategy many consider is renting property. Acquiring for long term hold can be a great way of making extra money.  The income can be used to fund other projects and deals.  This is because not only will you make some profit by being able to capture tax advantages and capital appreciation, but you will also gain profits from the monthly rent you are charging. However be sure you are very careful about the person or people you are renting to. Be certain to do your due diligence for all potential renters. 

Of course you could also take advantage of foreclosures as one of the other investment strategies out there. This has a little more risk involved, because of the amount of repair which may be needed or overlooked before buying.  Using REIAComps to make sure the deal will be profitable is how to succeed. Just be sure to weigh the cost of the repairs against how much you can make before deciding to go with any kind of property which has been foreclosed.

Lastly, one other investment strategy which should not be ignored is Real Estate Investment Trust (REIT). REIT’s do not involve you putting money into any one property and may actually be a good idea for some. However, still use REIAComps to weigh how much profit you can make.

In the end, choosing from among these investment strategies for real estate development can seem overwhelming.  Always use REIAComps to help you determine the best acquisition and ARV for every deal you look at. Don’t for one moment let someone tell you the value of a deal. Let REIAComps show you for yourself.

Mark JacksonMark Jackson is an appraiser, real estate investor and property valuation specialist who teaches others to get more out of their real estate investing business. In 1999, Mark founded an appraisal company and soon found his true gift was analyzing property values for real estate investors. Since 2000, has closed millions of dollars’ worth of his own domestic and international real estate transactions. Mark’s passions are: faith, family, golf and real estate.

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