5 Types Of Real Estate Investments To Try In 2022
Investing is a smart financial decision, and it's one that offers multiple ways to do it. This can range from using some money to start a small business, investing in stocks, buying high-quality jewelry, buying real estate, and more. Essentially, by investing, you allow your money to work, build your wealth, and beat inflation. In fact, it's also a good plan for ensuring having money when you retire.
Now, if you're reading this, then you're looking to invest in real estate. With the rise of cryptocurrency and mutual funds, investing in real estate may seem obsolete. But this can't be further from the truth as real estate won't go away anytime soon. Others need a home to rent/buy or an office for their business. Moreover, as real estate prices continue to soar, it's evidently a good investment. You just need to be informed and wise on how to go about it.
With this, investing in real estate may seem like a daunting experience—one that requires a lot of money. After all, one of the well-known ways to invest in real estate is to buy an entire property and then resell it or rent it out. However, there are more ways to invest in real estate ranging in cost, liquidity, and risk. Moreover, investing in real estate through other ways may not even require way too much capital either.
With that said, here are five types of real estate investments to try in 2022:
1. Digital Real Estate
If you're wondering whether there's a modern way to invest in real estate, then look no further than digital real estate. It essentially refers to owning a virtual form of property, one you can see online. A prime example of this is a website. This type of investment grows when your website grows. Furthermore, with the growing digital world, you can say that this isn't going anywhere soon.
With this in mind, this type of investment is often for those that don't want to or have a lot of money to invest in real estate or are just starting. This is because of its low overhead and start-up costs. In fact, you can purchase a domain for 10 dollars or less. Additionally, since this type of real estate investment exists in the digital realm that's accessible to everyone, you can market to anyone globally.
2. Online Platforms
One emerging way to invest in real estate is through crowdfunding platforms. This connects real estate developers with individuals who wish to invest in real estate through debt or equity. Unfortunately, there are currently a limited number of platforms that are accessible to non-accredited investors, and it can be very expensive too. But there are also a growing number of real estate crowdfunding platforms hoping to make it more accessible.
This type of investment is often for those that aim to minimize risk and diversify an already existing portfolio. Additionally, it offers an indirect way to own property and invest in real estate. As such, if this is you, then it's worth considering.
3. Rental Properties
Next, you can consider purchasing properties to rent them out. Using rental properties is a well-known way to invest in real estate, and it's still a great way to gain profit. With a growing market full of young professionals and families, you can purchase residential properties and lease or rent them out. Along with this, you can also purchase commercial property and rent it out to businesses looking for offices or spaces for a shop.
Now, it's worth noting that this type of investment requires a lot of money to start as you'll have to buy property first. Then, depending on whether you buy land or one that already has a building, you may have to pay even more for construction and renovation costs. On the other hand, it allows you to profit from rent while the property's value is also appreciated as time goes by. Furthermore, it's a great source of retirement income.
4. REITs
REITs or Real Estate Investment Trust companies own and manage properties that produce income. You can invest in these through an exchange-traded fund or mutual fund and own real estate equity. Furthermore, there are different types of REITs such as mortgage, retail, office, healthcare, and residential, among others.
This kind of investment is known to help diversify your investment portfolio and provide potentially high returns on investment while having low risk. Along with this, you gain profit from this investment through capital appreciation and dividends. If you prefer this kind of investment, then REITs are definitely worth considering.
5. Renting Out A Part Of Your Home
If you already own a home and have a portion of this you don't use, then you can consider renting it out. This can also work if you have a spare guest house or have a duplex but you're only using one of them.
One major benefit of doing this is that it won't cost you a lot to get started as you already have the property. Furthermore, using the rent that you charge a tenant, you can pay for a part of your mortgage. It's a great way to make money on the side using what you already have. or other debt. Overall, this allows you to make money from your property aside from the property's appreciating value and it's a great way to make money on the side.
Conclusion
Investing in real estate isn't a new way of investing one's money, and it's not an obsolete method to grow your money either. Much like other forms of investing, doing so with real estate allows you to put your money to work, grow your wealth, and beat inflation. As a bonus, this allows you to take advantage of real estate's soaring prices and the constant demand for it.
Furthermore, it's normal to view real estate investing as a daunting way of investing compared to stocks and other methods as it can appear to require a huge amount of money to get started. However, there are several ways to invest in real estate. With the list above, hopefully, you're now more knowledgeable about the types of real estate investments you can make in 2022.