Finance Monthly - November 2022

Things to do before starting real estate investment Like any other type of investment, there are different things to consider before starting the investment. Research is the most important of all. To start you off, read real estate investment articles, consult the field experts, enrol in real estate classes if possible and learn from the people already investing in the field. Don’t wait to learn the hard way in the field; you should learn from the experts. Types of real estate investments There are different reasons why people invest in real estate, and financial freedom is the major among them. Other reasons may include cash flow, property appreciation, leverage, tax benefits, etc. According to data received based on the Ofirio statistics, different real estate investments will offer you different cash flows, leverage, appreciation value, and benefits, among others. These are the common types of real estate investments: • Residential real estate investment This is where you invest in property that families or individuals dwell in (homes). • Commercial real estate investment This type of investment consists of property or buildings intended for business. In other words, these are office buildings. • Industrial real estate investment This type of investment includes storage units, distribution centres, assembly plants, warehouses, and manufacturing facilities. • Retail real estate investment This is an investment where the investor holds a property used for retail business. These include shopping centres and malls with tenants including restaurants, retail shops, salons, or similar enterprises. • Mixed-use real estate investment This investment is where the investor holds property with units that accommodate two or more of the others named above. Best ways to invest in real estate Investing in real estate involves different methods. As a beginner, you may be confused about where to start. To ease this down, the investment ways listed below will help you know where to start. Wholesaling Real estatewholesaling is a strategy where you secure a property at a market value through a contract and find a prospective buyer to buy it from you. In this strategy, you don’t take actual real estate property ownership. Instead, you own the contract that allows you to purchase the property and then look for a buyer for this contract. Wholesalers make money by adding a fee to the contract when selling it. Wholesaling is lowrisk and doesn’t require a lot of starting capital. However, it’s very competitive, and the returns may not be that high. In some states also, wholesaling is termed illegal. REIT investing Real Estate Investment Trusts are companies that own real estate properties. You invest in REITs by buying shares from these companies. REITs are created on the same idea as mutual funds, where shares are pooled together. REITs, however, consist of pooled companies. The means of earning from REITs is through dividends. Public listed REITs Inve s tmen t 48 Finance Monthly.

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