February 26, 2019 by NancyR

“Investing in real estate is a unique opportunity in that it presents a broad range of choices, which can all impact your future success. It’s a good idea to first start on the internet and get tips from successful investors like Than Merrill on Facebook. Ultimately though, one of the most important decisions you will have to make is in selecting the type of property you want to use for your investments. However, before you can make your decision, you will need to know about the kinds of real estate that are available to investors.”

Residential Homes

While most people think of fix and flip opportunities in terms of residential real estate investing, there are many more opportunities available with this type of property. A single-family or a multi-family home can be traditionally rented out to tenants, although this type of situation requires intensive management of the property. Additionally, residential property can be offered as vacation rentals or other types of temporary lodging. Investors should be aware that any situation that involves leasing the property will require more hands-on care than simply flipping a home requires.

Commercial and Retail Real Estate

When looking for real estate in Manhattan, Anthony Guerriero of Manhattan Miami (https://manhattanmiami.com/) recommends narrowing your search down to one type of property. Even so, an investment in commercial real estate involves properties that can be leased out to businesses for a variety of purposes. Some examples of commercial real estate include office buildings and strip malls.

This category also includes individual retail outlet stores, which can sometimes be a more lucrative type of investment. The eCommerce revolution has affected how brick and mortar stores operate, requiring less floor space per business. For investors, this presents an opportunity to maximize their profits. By buying a large commercial space and dividing it into smaller units, property owners can offer more spaces catered to the needs of retail businesses.

Since commercial real estate leases are good for more than the 12 months typically assigned to residential leases, this type of investment can provide several years of income stability. There is a downside to this situation, however. While a decrease in average rental rates means you would still be earning a premium rate per unit, you likewise wouldn’t be able to take advantage of an increase in the market average rental rates. Opting to invest in commercial real estate requires a greater talent for anticipating future market needs.

Industrial Properties

Industrial real estate differs from commercial real estate in terms of the types of structures used and the ways in which those facilities are used. Industrial real estate can include anything from warehouse and manufacturing facilities to car washes and self-storage units. Usually, tenants are expected to sign longer leases that ensure their long-term use of the property. In addition, the owner of the property may offer to install coin-operated machines and other services for a fee, providing an additional source of income.

Mixed Use Real Estate

It may not be surprising to discover that some real estate properties fall under multiple categories. For instance, an apartment complex can be considered to be both a residential and commercial property. Similarly, some companies offer retail services from their industrial facility, which may allow the investor to maximize his return on investment. While it’s important to try to stick with one type of real estate for your investment portfolio, you can loosely define what you mean by a certain type of property and take advantage of multiple opportunities.

Another way to look at mixed-use real estate is in terms of how the investor or property owner uses the property. For instance, an investor might buy a large office building that contains multiple units per floor. Instead of leasing the property to a single business, the units or each floor can be leased separately. This allows the investor to maximize his profits, while the influx of consumers for each business will improve growth for all tenants in the building. One office building might offer temporary employment services, banks, cafes, and small restaurants, health clinics, or a variety of other services that might cater to all consumers visiting the building.

Building a lucrative real estate investment portfolio requires understanding the market in your community, so you can take advantage of the most promising opportunities. If your community is saturated with retail businesses, investing in commercial real estate might not be the best strategy. It’s also to look at where the majority of available opportunities are located. While remote, out of the way locations might be desirable for industrial real estate, residential real estate should be more centrally located. Ultimately, you’ll have to rely on your research of the market and your own instincts to determine which real estate types will present the best investment opportunities for you.

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