The World of Real Estate
We’ve taken a look at real estate and by now we know it is a very powerful way to invest. It is one of the few businesses you can extensively use other people’s money.
The possibilities one has to get involved with real estate are vast. Below we have broken down those option:
Residential Real Estate: refers to any property related to residential purposes. There are two ways to look at this option. Buy a property to let or buy a property, flip it and sell it at a higher market value. This is also known as capital gains. It is important to decide how you want to use the property once bought. Will it be for personal use? Will you rent it ? If so, will it be for long term or short term? Furnished or unfurnished ? Will you buy a property flip it and sell to make capital gains? Asking yourself these questions will of course make it easier to manage your property but also define how much cash flow you should expect.
Commercial Real Estate: any property used only for business purposes such as but not limited to, retail shops, gas stations, hotels, restaurants, offices and parking stations. This investment is for the long-term. You can have a lease agreement for a year or two or more, however this depends on the legislation and on the country. Usually, an investor or a group of investors owns the property and collects rent from each business that operates there.
Industrial Real Estate: refers to any property used for but not limited to manufacturing, production and storage. Examples include, factories and warehouses. Utility companies for example, will own industrial real estate such as power plants that generate electricity.
Property development: is essentially when you buy a piece of land and you build a house or a building and you sell it at a profit.
Whichever way you chose to get involved in real estate, it will definitely be rewarding as it helps you create multiple income streams and most importantly accelerate your prosperity.