How to Invest in Real Estate

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Investing in real estate can by done by purchasing a house and managing tenants, or it can be done by purchasing a mutual fund or exchange traded fund that specializes in all kinds of local or global real estate. Consider which real estate options are most fitting for your lifestyle with investing advice from a certified financial planner in this free video on personal finance.

Part of the Video Series: Investing Information
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Video Transcript

Have you heard a friend or a person at a cocktail party talking about how they made a killing in turning a house around or getting a great piece of real estate. It kind of wets your appetite for a good investment in real estate. One of the things you might want to consider when you are looking at real estate is do you have the time and resources to purchase a hard piece of real estate? For example, an individual house or a rental house where you are going to manage the overall building and allow someone else to live there. You may want to consider your time and resources when you are looking at investing like this. Another way to have an opportunity to invest in real estate is to actually choose a mutual fund or an exchange traded fund that specializes in all kinds of real estate, everything from apartment complexes to malls to housing developments and things like this. These are called real estate investment trusts or REATS. You can also purchase into funds like this and get not only local real estate within the United States but there are opportunities to invest both internationally and globally. One of the benefits to diversifying your investments like this is that you are not limited in putting all of your investments into just one piece of property, instead you are putting a little bit of money in lots of different kinds of properties generating or increasing your opportunities for rental income and higher returns but again there is no guarantee. However, the benefit to having diversified real estate choices is if one of the properties does decline in value you still have lots of other investment choices within your particular fund.


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