Making Money In Real Estate 10 Basic Ways

Making Money In Real Estate 10 Basic Ways

Making Money In Real Estate - 10 Basic Ways
Making money in​ real estate is​ an​ endless topic that includes all the​ various types of​ real estate investments .​
There is​ land,​ apartment buildings,​ homes,​ commercial buildings and more .​
Whatever the​ type however,​ you'll make your profits in​ some of​ the​ basic ways listed below .​
Use this list to​ get yourself thinking of​ the​ possibilities.
1 .​
Appreciation .​
Making money in​ real estate can be as​ simple as​ holding on​ and waiting .​
To really get the​ most appreciation in​ value,​ however,​ you should buy in​ an​ area where demand is​ growing faster than the​ supply.
2 .​
Depreciation .​
Remember that after all the​ tax law changes,​ you still get to​ declare a​ loss for depreciation that doesn't really exist .​
That can save you a​ lot at​ tax time,​ meaning more after-tax profit .​
To maximize this,​ buy property that has its value primarily in​ the​ buildings,​ because you can't depreciate the​ value of​ land.
3 .​
Loan pay-down .​
You gain equity with every payment you make .​
Get the​ lowest interest rate you can and more of​ each payment will go towards the​ principal .​
4 .​
Cash flow .​
When you buy income property the​ right way,​ you not only have your tenants paying all the​ costs and paying down the​ mortgage loan,​ but you also have positive cash flow.
5 .​
Buy low .​
When you buy below market you get instant equity that will be converted into a​ profit when you sell .​
Offer a​ reason for the​ seller to​ sell low: fast closing,​ cash,​ assume some debts or​ liabilities,​ etc .​
Or just make a​ low offer .​
The seller may have his own reasons to​ sell it​ cheap.

6 .​
Sell high .​
Clean it​ up nice,​ make it​ easy to​ buy,​ and find the​ right buyer to​ get top dollar .​
The next four on​ the​ list cover ways to​ create value,​ so you'll get more when you sell .​
7 .​
Offer financing .​
You can often get substantially more for a​ property if​ you offer financing .​
This is​ especially true if​ you let someone buy it​ with little money down .​
You can also get good interest on​ the​ loan.
8 .​
Change use .​
If there is​ a​ higher use for the​ property,​ you can convert it​ to​ make it​ worth more to​ the​ next owner .​
Sometimes this means making condos into apartments,​ or​ apartments into condos .​
Maybe converting a​ home into office space will get the​ biggest return.
9 .​
Improve and repair .​
Repairing anything that needs it​ is​ obvious,​ but you need to​ look creatively and carefully to​ find improvements to​ make .​
Concentrate only on​ those that will raise the​ value several times more than what they cost you .​
10 .​
Sell in​ parts .​
In real estate,​ the​ parts are often worth more than the​ whole .​
For example,​ splitting off an​ extra lot to​ sell for $30,​000 will rarely decrease the​ value of​ a​ home by that much,​ so you'll make more money in​ the​ end.
Making money in​ real estate can be a​ wonderfully creative process .​
Just look at​ the​ sources of​ profits listed here,​ and think of​ how you can use a​ few of​ them on​ your next real estate investment.

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