Whether you're investing in REIT or you own and manage a rental property on your own, the potential for growth can be a great reward for investing. There is no quick way to make money or get rich in real estate, but you can increase your wealth gradually and consistently by investing correctly. You probably know that there are numerous ways to accumulate wealth, but real estate is one of the most effective. That said, making money in real estate or investing profitably requires sound guidance, methods, and determination.
While investing in real estate is a proven and true method of making money, like any other business, it comes with inherent dangers. With patience and time, real estate investment can generate significant passive income. That's why many millionaires invest in real estate. Not only does it make you money, but it allows you to keep much more of the money you earn.
If you don't meet the income and net worth requirements set by the SEC, you may not be allowed to lend money to real estate investors unless it's in symbolic amounts through a crowdsourcing site. Selling the properties to other investors and investing in real estate investment trusts or shares of a property managed by others is another. I have discovered that large sums of money can be made in real estate investments, but in general you have to hold the BRRRR for at least 5 years before making a 1031 exchange in another investment. So again, appreciation alone isn't likely to make you a millionaire, but real estate has always increased in the United States, averaging 3% annually over the past century.
Sometimes properties lose value, but in the long run the value of real estate will almost always rise. The more properties you buy, the more you can save and the faster you can achieve your goals of making money through real estate investment. There are so many advantages to owning real estate, such as leverage, appreciation, tax benefits, that just getting a “good deal” can turn into a great investment in the long run. If you have a large sum of money, you can, for example, buy an undervalued real estate, repair it, and sell it to an investor.
On the other hand, if you buy real estate and rent it out, you get more for investors' ownership because it comes with one source of income, the existing tenant. Insider spoke to people, including Zuber, who have used real estate as a tool to create long-term wealth. It's much easier to invest in real estate located across the country because you don't have to deal with local regulations related to real estate licensing or taxes. Over time, he built a 16-unit real estate portfolio in Washington and became financially independent of the rental income he earns.
All of these time leverage strategies give you more time and, at the same time, you spend your money working in real estate. I have barely brought to the surface what real estate investment can do for you in your quest to become a millionaire. Just to be clear, when I talk about real estate investments, I'm not talking about buying a house to live in. For example, it is possible to buy ETFs that invest in real estate stocks, such as publicly traded home builders.