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Investing in Real Estate

Updated on February 29, 2020

The What

What is real estate investing? Real estate refers to land, or anything which can be permanently attached to land. So, in the broadest sense, real estate could mean a building of any sort which is permanent (a mobile home is not technically, by this definition, real estate) or land on which these permanent structures could be placed. So, any money invested in real estate is involved in the definition above.

There is a lot of discussion regarding 'internet real estate,' which is applied to high profile domains (Yahoo, Google, sites like that.) The relationship between land based real estate and internet real estate is suggested to be that these high profile domains have acheived a similar level of permanency.

The Who

Who can invest in real estate?

Well, nearly anyone who can provide the resources. Real estate is nothing to scoff at, and can require substantial amounts of money. The keys to remember, as someone who is interested in making this kind of investment:

  • Your credit matters. If you are looking at taking out a loan to cover your investment, then you have to do research and analyze whether the profit is worth the risk. Gosh, sounds like any other investment, eh?
  • When choosing a piece of real estate, ask lots of questions. Has the land/building been appraised? What is the overall value of the neighboring properties? How has the local area affected the value of the land/building?
  • Be patient. Once you've narrowed your options down to a few prime candidates, take the time to fully explore these options.
  • Be proactive! If you find a property which suits all of your personal goals for an investment, take action. Trust your information, but also trust your gut. Half of the fun of investing (and yes, it can be fun) is the risk itself.
  • Make sure you can cover losses. Don't be irresponsible with a large investment such as this. Something may happen to the market and you might lose out big. Be ready for that!

The Living Investment

When specifically considering residential real estate, the practice of investing in land and homes, this is what I mean by a living investment. During the course of it's existance, a house and land see a lot of changes, experience their own brand of evolution. The fact is, residential property is constantly changing with the seasons, literally!

An investment in a home, which is then put on the market as a rental property, can bring a lifetime of income. The investor who chooses this path is providing a service to his or her community, and contributing to possibly countless lives through a single investment.

The Why

Why would someone want to invest in land? Moreover, why would someone invest in a building?

Hypothetical situation: You invest in a property and land in a very nice part of your hometown.

So why did you invest in this place? Some people invest purely for the money they will make along the way. In your case, in this situation, you have invested in a part of your own history. By making this investment you are creating a legacy for your family, right in your own proverbial back yard.

Though there are plenty of individuals and companies who invest in real estate as a purely profit-based venture, the hypothetical situation presented gives a glimpse at another side of the investment coin. By the end of the process, financial gain meets personal satisfaction.

The When

When is a good time to be a real estate investor? Pretty much any time. Pay attention to your market, and be absolutely sure of any investment you make. You will not lose out by fully researching your prospects.

Some things of note to watch for as signs whether to invest or not:

  • Local and international real estate market fluctuations
  • Local and national economy
  • Interest rates
  • Stock Market

The Where

Real Estate can be purchased and sold anywhere in the world. Something to remember when researching real estate properties is the location. How much you will spend on the property, as well as how much you earn from the sale of such, depends on many factors - only one of them being location.

Now, you can find information on real estate investing in a multitude of places. If you want to succeed, invest first in classes to become a real estate agent. You will also want to access internet resources, books and even videos to learn techniques for making sales, assessing properties, and wise money management when preparing for and completing your investment.

Comments

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    • real-estate2010 profile image

      real-estate2010 

      10 years ago from USA

      Real Estate has made more millionairs than any other profession. Now that prices have fallen and even though prices will still fall even lower, in my opinion, now is a good time to buy, if you know what you are doing. If you are a newbie, make sure you have proper guidance. If you want passive income, now is a good time to get positive cash flow properties.

    • highwaystar profile image

      highwaystar 

      13 years ago from Australia

      I agree, you simply an't go wrong with real estate investing, just got to use your head and not your heart so much, there's a bunch of profitable and fast ways to build a portfolio with some equity...thanks for sharing, cheers!

    • profile image

      Bogey047 

      13 years ago

      Very informative!!!

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