Compared to other forms of investment like the stock market, real estate takes a far different approach. Even against mutual bonds or stocks, real estate actually has more advantages. It can grant the investor passive income and control.

Invest in Real Estate and Get Your Money Back

First off, successfully investing in real estate property gives you predictable cash flow. It also appreciates and can be leveraged. Another attractive advantage of real estate is its improvability. By investing in some structural and/or cosmetic repairs, you can improve the value of your real estate property.

With so many advantages that it offers, it's easy to see why a lot of people are looking to take their chances in real estate investment. Yet, this industry can also expose an investor to a lot of risks.

So how does one safely venture into the real estate investment business without having to worry much? Find out here:

Be a Landlord

Rental properties are a great way to maximize the available capital. Aside from that, a lot of the expenses related to it are tax-deductible.

In more ideal scenarios, the properties can appreciate throughout their mortgage. This leaves you with far more valuable assets compared to where they started.

But you may want to get help from property management companies. This is because managing rental properties can be time-consuming, which is not a good situation to be if you are juggling your time between your day job and your properties. Another drawback is that you may also have to deal with dropping rental climates and vacancies.

Real Estate Investment Groups or REIG

If you still want to own a rental property but not the hassle that comes with it, you can try Real Estate Investment Group investing. Often, REIG members would pool their resources together to allow individual investors to buy properties that would otherwise be difficult to do alone.

You would also get to take advantage of the learning opportunities as you would be working alongside some of the experts in the industry. Not to mention the opportunity to grow your network.

However, there are some cons to REIG investing. While groups like these are typically safe for investing in real estate, you are also subjected to fees. These fees are the same as those in the mutual fund industry.

Also, you don't have the sole authority when it comes to decision-making, and members will not always agree on a common investment decision. On top of that, a lot of REIG are private investments where investors can be fooled for their money. So due diligence and ample research should be performed before investing.

Wholesale Real Estate Investing / House Flipping

Wholesale real estate investing involves contracting a home, often distressed properties, with a seller then finding an interested buyer before the contract with the original property owner closes. Wholesaling does not require much startup capital or spending on property improvement.

To be successful at real estate wholesaling, you need to have great marketing and negotiation skills. Of course, you need to have an eye for an excellent property to sell. You need to consider the location, the features of the property, and your asking price.

House flipping, on the other hand, is riskier and requires adequate capital, time, and ability to oversee or perform repairs when necessary. When flipping properties, an investor will usually find undervalued properties with profitable potential a few months after buying it.

The snag is that you would need deep market knowledge. You may also need some luck since even hot markets can cool off suddenly. This can leave any short-term trader with lots of problems.