Ways Of Investing In Real Estate And Get Profit From It

Making money in real estate is one of the ways of passive-over-then-active earning scenarios in life. There are several ways of earning, each requiring its own budget, time & effort.

Increasing property value as a certain way of making money in real estate

Three factors define the cost of any property: location, development & improvements. As cities expand, more land is taken to be used for the needs of city infrastructure development: building roads, houses, facilities & shopping malls. As they are built on the land, the cost of it increases even more. When you’re buying land or buildings on the outskirts, they grow in price as the neighborhood develops & the city ‘comes to you’. With wise investment, which includes the ability to recognize city development patterns & optimal prices for objects, this way becomes the easiest one of how to make money in real estate investing.

Also, you can make improvements to the held premises like making a better kitchen, adding a new bedroom, improving a garage… Anything that makes a house more modern-looking & stuffed will increase its price. That can be a good thing if you do not invest in modernization more than it will add in value for the next buyer. Also, this step would be wise on a developing market, not deflating.

Receiving raw land income

You can give your land plot to excavate or otherwise collect raw materials from it (given a buyer will have all rights to them). If they find oil or coal on your land plot, harvest wheat or rye, collect timber, drill an artesian hole, or anything like that, you will gain payment for such use of your land depending on the type of collectibles.

Buy & hold to resell to receive a real estate income

This approach considers inflation. As everything rises with time due to inflation, you can simply buy something & hold it for a while to resell it after several years or decades (given that the neighborhood develops, not decays & that the property value grows faster than money value drops). This is the easiest way of how to make money in real estate, as you do practically nothing (but paying some yearly ownership tax if applicable in your country).

Renting & leasing

It is possible to let your real estate for rent or lease to private or commercial users, receiving a monthly/yearly rent. Surely, it will require your real estate to have minimum requirements for these types of rent, like be furnished & ready to live/work, as well as you will have to take care of various minor improvements & repairs should anything break but these all are included in the rent price.
And this is relatively easy to do! This is why many real estate owners holding from several to several dozen rented spaces prefer doing nothing more in their life but idle living for the money that comes from the rent & lease. It would be wise, however, to save a reasonable percentage from this money to be able to buy a new space for rent when the old one fully amortizes (from 20 to 50 years).

Renovating an old property to resell

This option requires much money for real estate investing, as well as much effort & time. The essence of it is as follows: you buy some old house or building & renovate it according to the latest trends so as to resell it for a bigger price. Sometimes, the difference between the purchase & sell price can reach 20 times but any such undertaking requires a lot of money & time to be invested in the process of renovation.

This option is good not for everyone since it requires either hiring a professional team of workers who’d do all the works or doing them yourself if you’re a specialist in such. In some countries & locations, such works might require licenses, allowances & paperwork (and some works might be disallowed to be done by natural persons – only certified specialists of legal entities might be allowed). Also, not all premises are suitable for that: a house to be renovated shall have a reliable foundation, floor slabs & walls, not have insects, moist, or mold problems & be freed of various legal issues that would restrain its renovation & further sale. In addition, from several months to over a year of everyday work of a professional team is usually required to fully renovate a residential house of 2,000 sq. f.