Fastest Ways To Make Good Money in Real Estate
There’s a lot of money to be made in real estate, so you’re looking to get in the game. Many investors take a slow and steady approach to turning a profit, but that’s not what you have in mind.
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Instead, you’d like to cash in relatively fast, which is entirely possible. Here’s six ways you can make good money in real estate quickly.
Wholesaling
“Real estate investing may seem intimidating, but you don’t need a large amount of money upfront to get started,” said Tresa Todd, founder and real estate investing expert at Women’s Real Estate Investors Network. “Wholesaling is one strategy you can use, especially if you’re just getting started, as it allows you to invest with limited initial cash.”
To get started, she said you’ll search for distressed sellers who are facing situations like foreclosure or an unwanted property inheritance.
“Once you find a property, you negotiate a contract to purchase it at a favorable price –typically at 70% after repair value,” she said. “Instead of buying the property yourself, you find another investor who is interested in the deal and assign them the contract for the property.”
Afterwards, she said you’ll close the transaction with a reputable title company and receive your assignment fee.
“By utilizing wholesaling, you can enter the world of real estate investing without the need for significant upfront funds,” she said. “It’s a practical approach that enables aspiring investors to start building their real estate portfolio right away and seize opportunities in the market.”
Denis Smykalov, a real estate broker at Wolsen Real Estate, based in Miami, emphasized the importance of making sure you find the right price.
“The key to success is to identify highly motivated sellers who are willing to sell their property below market value,” he said. “Once you have identified a good deal, you can quickly find a buyer and sell the property for a profit.”
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Flipping Houses
Another way to make quick money in real estate is house flipping, Smykalov said.
“This involves purchasing a property, renovating it and then selling it for a profit,” he said. “The key is to identify properties that can be purchased below market value, but have the potential to be turned into a profitable property with some renovation work.”
Of course, being successful in this type of real estate venture requires a variety of skills.
“Successful house flippers must have an eye for detail, ability to manage a budget and a good sense of the local real estate market,” he said.
Short-Term Rentals
“If you own a property in a desirable location — such as a vacation destination — short-term rentals can be a great way to make money in real estate,” Smykalov said. “Platforms like Airbnb, VRBO and HomeAway allow you to rent out your property for short-term stays.”
He said investing in good marketing and renting out your property using the above platforms can allow you to earn good money quickly.
Rent-to-Own Lease Options
If you don’t want to make a large upfront investment, Smykalov said rent-to-own lease options can be a lucrative idea.
“This strategy involves leasing a property with an option to buy at a later date,” he said. “The renter makes monthly payments to the seller and a portion of these payments go towards a down payment for the property.”
When the leasing period ends, he said the renter can either purchase the property or walk away from it.
Real Estate Investment Trust (REIT)
“A REIT is a way to invest in real estate without actually owning property,” Smykalov said. “A REIT is a corporation that owns or finances income-producing real estate.”
In this type of arrangement, he said investors purchase shares in the REIT and receive a portion of the income, typically through dividends.
“REITs can be a great way to make good money quickly in real estate, because they provide regular income and are highly liquid,” he said.
Of course, to be successful, he said you’ll need to do your homework.
“All of these strategies require careful research, attention to detail and expertise in the local real estate market,” he said. “However, when executed properly, they can be an excellent way to make good money quickly in real estate.”
Bird Dogging
If you’re not familiar with the term, bird dogging involves finding motivated sellers, then selling those leads to another real estate investor for a fee, said Danny Johnson, owner of Danny Buys Houses, based in San Antonio, Texas.
“Alternatively, you can send leads to a real estate investor you trust for free,” he said. “The deal should be to receive a certain amount of money — usually $1,000 to $2,000 — if the investor buys the house.”
He said this method vastly reduces your risk, by eliminating owning real estate for any period of time.
Of course, as with anything in business, before making a move, it’s always important to carefully research any potential real estate transactions. The last thing you want is to end up losing money, when you were planning to turn a profit.
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This article originally appeared on GOBankingRates.com: Fastest Ways To Make Good Money in Real Estate
