The real estate market, like other sectors, was also battered by the recession. Even now that the feared “R word” is technically over, analysts expect its tail to lash at the economy. That brings us to the question: Is investing in real estate today a good idea? Experts are divided on this but actually, we are asking the wrong question. What we must think about is want branches of real estate are thriving despite the economic slowdown.
Believe it or not, there are methods of investing in real estate today that result in profits despite the harsher times. Some of these are rehabbing and wholesaling.
Rehabbing houses is buying a cheap property, making improvements to raise its value, and then selling that property for a higher amount. This business is flourishing today primarily because of the low prices of properties that may be rehabbed. Fixer upper homes, or distressed properties, and REOs (real estate owned properties) are selling for bargain prices nowadays.
The affordability of these houses entices investors who have little capital to try it. So if investing in real estate was only for the ridiculously rich before, now even common people can venture in it. Neophyte investors are also testing this business they can seek financing from many sources. Banks and other traditional lenders are releasing loans. For borrowers who do not have a good credit report, you can turn to private lenders. Ask relatives or friends who might have ready money and want to use this cash to earn profit.
Experts believe that rehabbers will not run out of properties to fix and resell, at least in the coming years. More houses are being foreclosed and sold by owners who are struggling financially. That means you will not run out of products to sell. Buyers are also taking advantage of the opportunity to own a home at relatively lower prices.
Another hit strategy of investing in real estate is wholesaling. Also called flipping houses, this is placing a property under contract to buy it. You will then find a buyer who will close the deal for you. Wholesalers are paid assignment fees. Since you don’t need to buy the house but merely put it under contract, you don’t need any financial capital to start in this business. This legit scheme is related to rehabbing because many wholesalers sell contracts to rehabbers. In short, they find houses for rehabbers who then sell houses to end-buyers, or the new home owners.
Whatever kind of investing in real estate you choose, what is important is you know what you are doing. Research on these methods at REIwired.com today. This website contains articles and videos beginners and even veteran find useful.