Landlord, House Flipper, or Passive Investor? Which Real Estate Investment is Right for You.
Real estate is a popular investment opportunity, offering steady returns to the savvy investor. Many are attracted to the fact that real estate is a concrete, physical asset. This gives peace of mind that the investment will not just disappear overnight. However, there are many ways to generate income through real estate. Read on to determine which real estate investment is right for you.
THE LANDLORD ROUTE
Being a landlord or direct investor is not for the faint of heart. It is a time-consuming process with many hurdles. Consider that the upfront investment costs pose a formidable barrier in and of themselves. For a conventional loan arrangement, you are looking at a down payment of 15-25%, plus closing costs, which can be 2-5%. This can easily add up to hundreds of thousands of dollars upfront, in just one single-family home investment!
As a landlord, you also have a lot of work ahead of you. For example, expensive renovations, disagreements with contractors, interviewing new tenants, and worries about whether they will pay their rent on time every month. There are also many risks to contend with. Will your new tenant destroy those new carpets that you just invested in? Will you have to rebuild after a catastrophe like water damage or fire?
One of the critical factors in a successful investment portfolio is diversification. Building a properly diversified portfolio would cost you millions as a direct investor. If you are a part of the 99%, you might as well just forget about any kind of diversification strategy as a direct investor.
THE HOUSE FLIPPER ROUTE
Some investors avoid dealing with new tenants and long-term risk by flipping properties. They buy homes, fix them up, and then try to quickly resell at a profit. However, homes do not always sell quickly enough, or at a high enough return. This is also a very time intensive, risky way of investing in real estate.
ALTERNATIVE WAYS TO GENERATE INCOME
There are other creative ways that the 99% can generate income via real estate. For instance, renting out your vacation home or a spare bedroom on platforms like Airbnb is an increasingly popular way to make money. While you will have to change sheets and greet guests frequently, you can generate a decent income this way.
Some people thrive off these investment opportunities, enjoy the difficulties, and spend every spare hour they have managing their properties. However, if thinking about all of the hard work, capital, debt, and risk involved in being a full-time landlord or a house flipper makes your head spin, it is time to consider working smarter, not harder!
THE PASSIVE INVESTOR ROUTE
Passive investors are not involved with the day-to-day stresses of investing in real estate. They most likely don’t want to be involved because they have another job and sources of income and can not be hands-on.
When you invest with DiversyFund, our expert management team takes care of all of the legwork- investing in the right properties at the right prices. Our seasoned teams handle purchasing, tenants, renovations, and all of the other headaches of real estate investing.
Real Estate Investment Trusts (REITs) like DiversyFund’s Growth REIT, allow you to purchase shares in a diversified portfolio of real estate investments. With DiversyFund’s Growth REIT, you can invest with as little as $2,500. That’s about the same cash outlay as one low-end bathroom renovation! DiversyFund’s Growth REIT provides the opportunity for the 99% to get the strong returns associated with investing in real estate without the hassle, and without needing the capital of the 1%.
Complete your investment entirely online and start earning interest in minutes. DiversyFund’s Growth REIT reinvests all cash flows to provide increased and compounded returns to investors. This way, you can get on with the rest of your life, while we put your money to work for you. Simply log in to your online portal and receive monthly updates on the financial performance of your real estate investment.
There is plenty of opportunity and money to be made through real estate. You just have to decide if you want to be a full-time landlord, a hands-on flipper, or a passive investor who has the time for other endeavors.
To learn more about the DiversyFund Growth REIT, visit us here.