Investing in real estate provide plenty of benefits to you, and also can fund your retirement. Most of the baby boomers were work hard in order to save more money to enjoy the rest of their life. But, you may seen some of the baby boomers were smart enough to put their money in property investment in earlier time (in old time, the property or land isn’t expensive). Now, what you’ve had see? They’re rich like hell right?
So, invest in property can only make you become wealthy (if you did the great way) and nothing more. If you want to invest in real estate in order to able to enjoy your lifetime while your retired, here are 3 ways to invest in real estate to fund your retirement.
1. Real estate trading
The traders will purchase properties from owners with the intent to hold them temporarily and then later sell them for a better profit. This practice is also referred to as Flipping Properties. Traders will normally purchase properties that are very high-priced or highly undervalued. Sometimes when a trader purchases a property with a low price they will try to increase the value by doing some renovations. By doing this it can actually result in the trader getting a huge profit when they sell.
Our thoughts ➣ Flipping properties consider as less risky investment strategy as the above said. But if you flip a property after owning it for less than 1 or 2 year, it doesn’t qualify for long-term capital gains treatment. Apart from that, this is a high cost investment too. If you are taking a mortgage loan, the bank then will impose early settlement penalty. Besides that, the legal fees and agency fees are the cost that you can’t underestimate too. And, not to forget the interest and stamp duty that you paid when buying a property. These costs are often can directly affect your profits, but, if you did it in the correct ways, you can still earn the massive profit from it.
This stands for the Real Estate Investment Fund and is one of the easiest ways of investing. The invested money is put into this fund. It is created when a corporation or trust uses the investor’s money to operate and buy properties. It functions like a stock exchange. The corporation or trust will have to pay out ninety percent of its taxable profits to the various investors in the form of dividends. This investment is the right choice for someone who wants to earn a regular income.
Our thoughts ➣ REIT is holds rental properties to generate incomes. The rental properties can be, office building, shopping malls, land and etc. But do note that there is still have significant problems with the valuation of real estate, you’ll need to consider that REITs will also take a serious hit if the property valuations fall. If you really interested in REITs, you’ll need to put some effort to keep on eye on whether real estate market is remain healthy. Do consult stockbrokers regarding the current real estate market before you doing it.
3. Giving on rent
Buying a vacant habitable house can be rented for a period of time with the owner of the property paying for the mortgage, various taxes, and maintenance. The rent is normally decided on the basis of where it is located. The owner will get a fixed amount of money each month in rent. Some owners like to charge more for rent so they can get more of a profit. The best thing to do is charge enough rent to cover the mortgage payment. When the tenant moves out you should put the property on the market to sell to get additional profits.
Our thoughts ➣ This is the best choice to earn the passive income for your retirement. You may apply mortgage loan from bank, and do research where is the house that have high chances to rent out. For example, the house nearby a university or office building. (Click here to read Step by Step Guide for Renting Out A House)