Ways to Make Money in Real Estate
Neil Shekhter of NMS Properties - Proven Ways to Make Money in Real Estate
People have been going into real estate to make money for a long time and it's become even more popular lately. Some people still aren't sure or don't know if that have the resources it takes. In all honesty, you don't need the best credit, assets, or even too much to start up. You can take out a small escrow and use that to start your dream of being in real estate!
1. Long-Term Residential Rentals
One of the most common ways that people make money in the real estate world is by having long-term residential rental properties. No matter what happens, there's going to be people who need somewhere to live. The best thing you can do is find a great place in an awesome location. You'll want to make sure you have enough cash to put down a down payment, so you can keep the property for a long time.
2. Lease Options
Leasing is a great way to get into the real estate world without having to have great credit or a lot of money down. You would be leasing the property with an option to buy later. The great thing is that it isn't something that can't be changed. You could actually end up getting the property at a discount, depending on the housing market. If that's the case, you can turn around and sell the property for a higher amount to make a profit.
3. Home-Renovation Flips
Flipping and selling a house can bring in a substantial profit. You'll need to have a contractor and do a physical tour of the house. Once you do that, you figure out how much you want to spend on the flip and see what you can do with that amount. Then you decide on the sell price based on the flip amount and the amount you paid for the house. This is especially good for houses that are low cost and have simple fixes.
4. Contract Flipping
Another thing you can do to make a profit is by doing contract flipping. You would charge a certain amount and find a seller who is pretty much desperate to sell their home and a buyer who is ready to buy now. By doing this, neither party will have to wait to long and you've essentially brought them a service that they both need!
5. Short Sales
These types of sales are difficult and tricky, but they can bring a huge return. This can happen when a person is behind on their mortgage, but that house hasn't actually gone into foreclosure yet. In order for a short sale to happen, everyone needs to agree because the amount will be less than what is still owed on the mortgage. You then negotiate a fair price that all parties are fine with.
6. Vacation Rentals
Who doesn't love going on vacations? Sometimes, people want to stay somewhere other than a hotel on their vacation. By renting a vacation property, it will almost be as if they are in a home. If you choose an area that has a lot of people who vacation there, such as Florida or California, then you'll make a decent profit!
7. Hard-Money Lending
For this, you can either be the borrower or the lender. These are loans that are only for a very short time and usually have high rates because of this. To be the borrower, you want to make sure you have something that isn't going to fall through. If you're the lender, you'll need to have capital, so you can get started. If you have a definite thing but don't really have the capital, then this is a good route.
8. Commercial Real Estate
When going into commercial real estate, not only will you buy the places, but you'll also renovate and repair them. You can then rent or sell them. This is great because companies are always going to need somewhere to house their operations and employees! As you make a profit, you can buy several other commercial properties!
NMS has offered quality rentals in the Los Angeles area for nearly three decades. Since 1988, NMS has developed and managed a large portfolio of premier apartment buildings and commercial properties in Santa Monica, West Los Angeles, Brentwood and the San Fernando Valley
SOURCE: NMS Properties, Inc.