Real Estate Investment Opportunities on the South Florida Market

The real estate market has considerably grown in popularity in the past few decades, especially in Florida. While, in the past, people simply thought of their homes as a potential real estate investment, today there are many other solutions and opportunities available that can bring in a fortune if you have a solid strategy.

Investing in real estate is no simple matter, however. Whether you just want to buy and rent small properties or invest in huge residential and commercial real estate projects, your plan is likely to be far more complicated than when investing in stocks or bonds.

Types of investments to Consider

The options available on the market can be overwhelming, even if you do know a thing or two about basic issues relating to real estate investments. Following is an outline of a few major and popular areas where you can successfully invest your money:

• Basic rental properties can gather a fortune to the right buyer. The idea here is to get a mortgage loan to buy a new property and then rent it out to potential tenants. If all goes well, by calculating your income and expenses, you can generally charge enough on rent to obtain a profit.
• Real estate trading is far different from becoming a landlord, even if at the core, it may seem similar. Traders buy properties and hold them for a short period – usually less than 5-6 months – after which they try to sell them at a profit.
• REITs (real estate investment trusts) are created by large companies and corporations with the intent of using investors’ money to buy and operate various properties. The great thing about a REIT is that you’re not limited to residential properties, and can easily invest in office buildings, malls or other types of commercial real estate.
• Joining real estate groups is a way of starting out with advanced real estate projects without having to deal with the hassle of becoming a landlord. By joining a real estate group or club, you can invest in multiple properties, while the group manages them – along with all the other properties owned by members – as a collective.

How Much Are You Willing to Invest?

Whether you want to invest in REITs, rental real estate or any other method, there is basically no upper limit to what you can spend. The only thing to keep into account is that, if you don’t actually have the money, there is a limit to what you can borrow.

Moreover, the more money you put into a business, the better the chances to achieve greater profits, but the risks may be equally high if you don’t do your research properly.

With home prices going up, however, and with real estate constantly growing in value, you don’t even have to count the tax incentives and benefits involved to know that investing in a property or in REITs may provide excellent long term profits.

Also, it is worth mentioning that, since real estate has little correlation to the stock market, it can become a great asset over time for reducing portfolio risk and increasing returns.

Borrowing for Your Investments

With the positive changes that the Florida real estate market has gone through in recent years, borrowing money to start your investments has become a much more attractive endeavor. Nevertheless, caution should still be applied, as you can never truly know what challenges or obstacles are in store in the future.

• Reading up on the details of mortgage loan offers provided by different lenders
• Considering a number of other borrowing solutions and calculating the amount you will have to spend
• As well as the return estimates you might expect

… Are all important requirements if you want to avoid any risks.

Flexible options are available today that can help you avoid mortgage interest fluctuations, and while helping you find them, our experts at Realty45 Inc will also guide you in making the best decisions with regards to the way you can balance repayments with your lifestyle and investment goals.

Efforts and Risks Involved

Unlike what most people think, the effort associated with real estate isn’t in actually locating and purchasing of a property or in finding decent workers who will provide maintenance. Instead, it’s in the daunting tasks of studying real estate investments closely to avoid any unforeseen risks and problems that could end up reducing your income or even getting you to lose some money.

The most common risks associated with real estate investments are:

• Insufficient (or non-existent) income gained from property sales or rentals for covering monthly expenses;
• Damage caused by storms, earthquakes and other natural disasters;
• Paying too much for properties or projects that may not bring in the return benefits you expect;
• Buying properties that may have extensive structural integrity issues you haven’t noticed before;
• The risk associated with investing in a single REIT without prior examination of the project management strategies or geographical location.

Fortunately, many of these risks can be avoided with careful research and consideration. For instance, a good insurance policy can provide you with adequate compensation for loss of property after a natural disaster, and investing in multiple REITs can prevent a thwarted project from diminishing your returns.

Exploring Your Options

As you may expect, not everyone can start any type of real estate investment. While some only require a limited investment, other opportunities may demand a substantial amount to start with, while a few are only recommended for experienced traders and investors.

Whether your goal is to start big, go slow or follow a specific investment strategy, the Realty45 Inc team can help you figure out the details of your investment and get expert insight on current market trends, tax related issues, tips for managing long term investments and much more.

Beginning investors are advised, of course, to start small and build their business from the ground up. Over time, with the growth of their experience, returns and equity, they are able to gradually increase their portfolios and aim higher, while also potentially switching their strategies depending on market trends and the potential for better solutions.