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For investors looking to diversify their portfolios, the real estate industry is one sector of the economy where investors have the unique opportunity to directly influence the performance of their investment.

First time buyers are often financially limited to the purchase of a single house, but the difference between real estate investing and stock purchases or bond investments is the investor has control over the direction of his investment.

The initial cost of purchase plus property rehabilitation may deter some investors, but the rehabilitation will immediately result in the appreciation of your investment's value, thereby creating the opportunity for you to flip the property for a profit. All that's needed is the small down payment for your first house.

Foreclosed properties are discounted properties, and with foreclosure rates at historic highs even inexperienced investors with little capital can afford to participate in real estate investment because the fix and flip model is lucrative in this environment.

Investors who purchase and rehab homes then resell for a profit in this market have a greater opportunity to increase their property portfolio.

 The income generated can then be utilized for investing in new properties in different regions, further diversifying an investor's property portfolio and increasing their cash flow via flipping the new properties or renting them. Such success can quickly turn a side project into a lucrative career.

The fix and flip model of real estate investment is a sure way to quickly realize profits on your investment, but for those who prefer to rehab homes and retain ownership, renting out a renovated property generates a steady cash flow every month.

 Thus, for bear investors, renting is an equally wise choice. According to the Zillow Rent Index, in the period between February 2011 and February 2012 the rent average rose by 2 percent, and in certain markets the increase was as much as 14 percent. Real estate investors in regions experiencing high growth would do well to retain their properties as rental units generating a steady income and a property management company would be beneficial to an investor who chooses to retain ownership.

 If you have been thinking about diversifying your retirement portfolio, please contact us today!

Steven Jon Baldwin

Keller Williams Greater Columbus

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Real Estate Websites - US Real Estate Websites
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