What a great question! And the answer my friend is a resounding YES!
I have a lot of people talk to me about the income possibilities available through real estate investments. Some are more cautious than others unsure about when is a good time or worried about the possibility of a market shift or worse.
As I’ve said before, none of us have a crystal ball so we can’t predict what the market holds however by staying informed about your market you can at least keep your finger on the pulse of your current market conditions.
But how do you make the best decisions when it comes to real estate investment?
Well, there are a number of factors, the most important is your comfort level with real estate investment. There is nothing in this world that has 100% certainty and there are always risks associated with any investment so you need to consider what your risks are and how you will manage should any of the hypotheticals happen.
Hang on, I think I spot an elephant in the room!
So let’s talk about the elephant in the room and flesh out some of these worst case scenarios….
- You lose your job. If you plan to finance your investment then this could be something that’s weighing on you. There’s always the possibility so if that happens what can you do
- If the property is paying for itself then you don’t need to take any action
- You can sell the property and remove the financial burden.
- The market crashes. Once again this is a possibility that no one can really predict. If you are planning to flip the property this may be a concern but if it’s a rental or short term rental then it shouldn’t impact you as much.
- The house doesn’t provide the financial gain you were hoping for. If that’s the case you can audit how you are managing your investments. If you’ve never worked in or invested in property you can’t expect to know everything so you can get some outside help, change how you are managing your property or sell it and move on.
HOW can you make money in Real Estate?
Renovating for profit (Flipping)
I love renovating for profit, you can create a wonderful home for someone whilst gaining a great income in a short period of time. Most flips we take around 90 days and with the right no how you can earn a lot of money. Check out The Flipping School for more information.
Long Term Rental
If you’re looking to build a long term property portfolio then rentals could be the way to go. Being a landlord is not for everyone so you will want to consider if you will manage it yourself or hand it over to a management company. It’s a great way to build a property portfolio for the future, for those of you with ambitions to own multiple properties – if managed well – you can aim to leave your job to manage your properties and live off your rental income or have your renters pay the mortgage to give you some financial freedom with a longer term plan to sell.
Short Term Rental
As already mentioned, rental properties can offer you long term gain as you work to build your portfolio. Short term rentals / AirBnB properties are a great source of income especially if you want to use the property in the off season. If managed and prepared properly for the market your property should pay for itself during the peak season and with some upside in the off season. This may not be the case for every property depending on fees etc but this is what you should be aiming for.
So the long and the short of it is that you absolutely can make money from real estate investment, it’s all about balancing the risk versus the return.