Real estate investment involves purchasing,
ownership, renting or selling of real estate for profit. Example of real estate investment are apartments and rental houses, owners do not live in this house,
but use as to generate rental income from renters. They also expect to generate
profits as increment in property values. Investing in real estate has popular
over the last many years. Investing in real estate has lots of opportunities
for making big profits, investing in real estate is easier than investing in
stocks and bonds.
Real estate investment doesn’t have
complex rules, and it offers a lot of opportunities. You only have to purchase
a property, re-furnishing it and finding a trustworthy renter.
However, you should not use your own
name while investing in the real estate market because another party can file a
suit against you for damages. Then it will be hard to survive financially and
may be you have to go beyond the insurance settlement. So , to avoid this risk,
always use a special legal structure called Limited Liability company (LLC) or
Limited partnership (LP).
Different types of real estate
investments are available in the market. The following are types of real estate
investment:
- Residential real estate Investment: This is an investment type in which you invest in a residential property, for example houses, apartments, buildings and a family pays a rent to live in that property. In a rental agreement with the party their duration of stay is decided.
- Industrial Real estate investment: This is an investment type in which car wash, storage units and other special properties. Income is generated from those who use these facilities temporarily.
- Commercial Real Estate Investment: In this investment type, office buildings are used for income. Savings are used to construct a building with individual offices and lease them to small business companies to earn rent.
- Retail Real estate Investment: This type of investment involves shopping complex, strip malls and other retail outlets. In this investment you earn by receiving rent from renters of the store.
- Mixed use Real Estate Investment: In this investment any of the above investments combines into a single project and offer modification which reduce the risk of loss to a minimum.
- Real Estate Investment Trusts (REITS): It is basically a trust that acts as an agent in a real estate investment.
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