How to Invest in Real Estate

Most investors include real estate in their portfolios. This is because real estate is generally a good bet. While nothing can be guaranteed real estate generally goes up in value. This is especially true if you are in it for the long term. On average, house prices in Australia double every ten years. Even allowing for inflation that makes purchasing a house a sound investment. 

It is important to note that real estate investment is long term, this isn’t something you should be considering when you are about to retire unless you’re investing in shared ownership.

You should also remember that making a donation to your local surf lifesavers can help to maintain the facilities in your area and this maintains house values. 

Buying A Renovation

You can purchase a house to renovate and then live in it. This is a basic form of investment but effective. The idea is you get the house cheap because it needs a lot of work. You can do the work over as long as you like while you live in the house. When you’re finished the house can be sold. The work you’ve done along with the general increase in house prices means you can sell the property for a reasonable profit.

Flipping

This is similar to buying to renovate but faster. The idea is to make a low offer on a house that needs a lot of work. Then, get the work done and sell the house on. The décor will be neutral and you’ll need a budget that will have to be stuck to.

This will enable you to maximize the profit on selling and prepare you to repeat the process.

Become A Landlord

Buying a house to rent can be a good idea. You’ll need to find someone to rent the house and you’ll need to make sure it is up to code. That means electrical checks, gas safety checks, that the house has smoke alarms fitted, and all maintenance is done. 

This will allow you to rent it for a reasonable price and collect rent every month. This effectively pays for the house and gives you a property when the mortgage is fully paid.  

Don’t forget, you don’t just have to go after the private market. You can purchase commercial buildings and rent them to businesses. This is often a lower risk approach than traditional renting to private individuals.

Trusts

Another interesting way to get into investing is through trusts. The trust is a collection of properties. You buy into the trust with other people. The trust then purchases properties to rent, refurbish, or do what they like with. The aim is to make money which is then split across the investors in relation to your share of the investment. 

This approach diversifies your portfolio, effectively reducing the risk. But, you will be taxed on the income. However, you can access the original money easily if you want or need to. That’s an interesting and useful benefit. 

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