A progressively popular venture for investors at all levels is investing in real estate. One of the chief reasons for this is that there are a lot of means to profit from real estate investments. There are various limitless opportunities for making your Saint Peters real estate investments profitable- from buying and “flipping” properties to get instant cash to owning rental homes for long-term wealth building.
For the bulk of investors, the question of how to maximize profits boils down to two key options: selling versus renting. In this article, we’ll take an in-depth look at how real estate investors are profiting from both and which may be the more excellent option for different investing styles and situations.
Selling as an Investment Strategy
An excellent way to profit from rental properties is to buy with a plan to sell. To have the endgame in mind for all of their investments is what investors need from the start. Using selling as an investment strategy changes the focus from buying properties to hold and rent to buying properties that you plan to sell within a shorter amount of time. To prioritize selling as an investment strategy, you could do it through “flipping” a house. This means buying, renovating, and selling the property quickly.
However, flipping houses isn’t the only strategy investors utilize to profit from rental real estate. There are investors who will search for great rental homes from bargain properties that need only a little bit of updating. After that, if the value goes up, either due to improvements or market appreciation, or both, they turn around and sell the property as a rental home to other investors.
Occupied rental homes can often be successfully sold as turn-key business opportunities for those searching to include in their investment portfolios without all the work of getting a property ready to rent. Naturally, this strategy is only effective if the purchase price is low enough or the market appreciates fast enough to cause the desired return.
Renting as an Investment Strategy
To earn income from real estate is to buy properties to hold and rent. This is another common investment strategy. In general, this approach is viewed as a much more effective strategy for long-term wealth building. This strategy lets investors profit from rental houses by collecting rental income every month and collecting rental income when the property is sold. But the year-over-year gain might not look as big as the proceeds from a sale.
The income generated from the sale of a long-term rental is more or less going to be higher since any debt against the property will have been paid down over time. But this depends on how long you hold the property and how well you prevent any severe economic downturns. If you have the time to hold property and favor stability over quick payoffs, buying to hold and rent is probably your best option.
Invest Like a Pro
Maybe the top reason some investors don’t find the buy-and-hold strategy appealing is managing tenants. Traditionally, rental homes are managed by property owners, many of whom are not professional landlords and have little property maintenance skills. Yet as Saint Peters professional property management companies have expanded and improved, many investors are looking to the experts to help them boost their profits. If the only reason you like to sell investment property is that you’re tired of managing bad tenants, it may be time to hire a professional Saint Peters property manager to do the job for you.
We want to help rental property owners like you build real wealth through real estate investing at Real Property Management Endeavor. To learn more about the services we offer, contact us online or call us at 636-244-5959.
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