5 Real Estate Investment Opportunities That You Should Consider

Do you want to get into real estate investing but do not know where to start? Notwithstanding the popularity of real estate investment programs on HGTV, fixing and flipping houses is not the only way to make money in real estate. Here are five real estate investment opportunities to consider:

Single Family Homes

The benefit of single-family homes as real estate investment opportunities is their flexibility.

• Owner occupied: You can reside in the single-family home until the time is right to sell the home at a profit. This is particularly useful if you anticipate waiting out a recession.
• Tenant occupied: You can rent the home to tenants. Rental homes are viewed as particularly recession-resistant investments since the demand for rentals increases when the economy is in recession.
• Fix and flip: You can invest some money into improving the property, then sell it at a profit. Among those features that have a high return on investment (or ROI) are landscaping, siding or exterior paint, and wood flooring. The disadvantage of fix and flip real estate investment opportunities is you might be subject to a down market if the economy hits a recession.

When investing in single-family homes, you may want to consider investing in luxury real estate. Luxury real estate can enable you to achieve the aforementioned benefits with the added option of turning the home into a vacation rental. Online marketplaces like Airbnb have given luxury vacationers a way to find high-end vacation rentals with ease.

Multi-Family Residences

While multi-family residences typically include apartment buildings, a forgotten market exists in duplexes, triplexes, and fourplexes. These multi-family residences can provide the best of both worlds if you live in one unit and rent the other units out. In the ideal situation, the rented units would provide a stream of revenue that is enough to pay the monthly mortgage, allowing you to live rent- and mortgage-free.

Another unsung benefit of duplexes, triplexes, and fourplexes is that they are usually eligible for financing. You can achieve this through residential mortgages rather than commercial loans, as long as the owner resides in one of the units. Residential mortgages are usually easier for non-professional investors to arrange than commercial loans, too. Because they are offered by nearly every bank, you can usually shop for mortgage terms that suit your needs.

Commercial Real Estate

This is the investment class that most people think of when they think of real estate investment opportunities. In 2019, the commercial real estate market grew by nearly 1.5% alone. Examples include:

• Hotels
• Retail stores and restaurants
• Office buildings
• Storage units and warehouses
• Factories
• Entertainment facilities

There are a few common risks associated with investing in commercial real estate. These may include a breach of the lease or being unable to maintain occupancy during a broad economic downturn. Here is where a commercial Realtor can provide valuable assistance: they have industry knowledge and the skills necessary to research into both the specific property and the area in general.

Vacant Lots

Whether a vacant lot is zoned for residential development or commercial development, its advantage is that it is a blank slate. This could allow for a broader range of development options than a pre-existing building. It could become the site of a DMV office, a 4,000 square-foot home, a hospital, or a big box retail store. Investing in vacant lots, however, will often require a great deal of patience while you wait for the development of utilities, roads, and support services.

Investment Groups

Investing with others is not typically considered an asset, but a strategy. Investing with others allows investments in larger real estate opportunities, such as shopping centers, hospitals, or even sports arenas. For less experienced real estate investors, being part of an investment group can provide an opportunity to work with more experienced investors, lawyers, and Realtors.

Real estate investment opportunities abound if you creatively consider how businesses and individuals use real estate. When you want to learn more, don't hesitate to reach out to the Williams Group for information.