5 Of The Easiest Ways To Get Into Real Estate Investing
Knowing what to do with your money can be stressful. For many of us, we are so focused on paying our bills and saving a little we don’t put much thought into retirement and what we will do after we stop working.
The easiest and most understood way to invest for retirement is with stocks, bonds, and mutual funds.
But not everyone likes to have their money controlled by the stock market. Some investors don’t trust major corporations to take care of their profits, employees, and the environment. If that is you, where do you turn to invest your hard earned money?
Since the beginning of time investors have used real estate as a way to diversify their exposure to risk in the stock market and make passive income after they stop working. Getting into real estate can seem really confusing and difficult.
Today I want to show you a natural progression that an investor can take to get into the real estate industry and some practical tips for each step in your real estate investing career.
Invest in yourself first
As with any investment it’s important to be well educated. You should set aside a couple of bucks and buy some used books on Amazon to learn what it takes to be in real estate. There are a lot of real estate books out there and not all of them having boring titles.
Spend a couple of months learning about the mindset, the financials, and some of strategies that real estate investors use to capture wealth from rental properties.
Learn from others
One of my favorite parts of my real estate journey has been listening to others who have gone before me. I enjoy hearing their stories, where they struggled, and where they have seen success.
There is no better way than a podcast. Find a list of real estate investing podcasts and try listening to them when you are doing chores around the house or commuting.
Take notes on what works and what doesn’t. Often you will have more questions than answers when you first start listening. That is okay. Keep going and write down your questions so you can research them later.
Crowdsource your first deal
When you are ready to tip your toes in the water, consider investing in a real estate deal with a bunch of other real estate investors.
The benefits of doing it this way is you don’t have to spend a bunch of time and money sourcing the deal, closing on the transaction, and analyzing if it will cashflow.
There are a TON of crowdsourced real estate platforms out there. Spend some time this weekend Googling some of them and reading reviews.
It’s important to do your research and invest your money with a company you trust and in a fund you understand.
Another great way to get started is with a REIT. A REIT is a Real Estate Investment Trust and is set up to allow investors to pool their money together to fund transactions. After the transaction is complete you can share in the profits based on the shares you have in the deal. This type of investment is very much like a stock but has real estate backing it.
Buy a property from a turnkey company
If you have extra capital laying around that you don’t want to put into the stock market you can consider buying a property from a turnkey company and renting it out to tenants.
We could write a book on all the thought and processes that would need to go into buying a property this way.
A turnkey property means that an investor bought a house, fixed it up, and put tenants in there. All you need to do is fund the deal and then manage the property going forward.
This saves you time from finding the deal, analyzing if it will cash flow, fixing it up, and screening your first tenants.
This might seem like a huge jump from buying REITs and it is. But, we wanted to mention that buying a house to supplement your income later in life is a natural activity most investors take in their investing journey.
If you want to consider this route an excellent resource is BiggerPockets.com it is by far the most useful and active forum on the internet for real estate investors.
Help other investors and agents buy/sell houses
This option gets overlooked quite often. If you don’t have a lot of time to be in the real estate industry you can help others who do.
Agents and investors need leads to run their business. You could create a simple website or business that helps sellers and buyers connect. You can write blog posts, create videos, or create pages of information to attract home buyers and sellers. You can take those leads and give them to agents or investors you have networked with.
They are generally willing to give you a small commission for providing such a valuable service.