An increasingly favored venture for investors at all levels is investing in real estate. One of the top reasons for this is that there are various ways to profit from real estate investments. From buying and “flipping” properties to get instant cash to owning rental homes for long-term wealth building, the possible opportunities for making your Glenview real estate investments profitable are seemingly endless.
The question of how to maximize profits, for the majority of investors, 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 preferable option for different investing styles and situations.
Selling as an Investment Strategy
An effective way to profit from rental properties is to buy with a plan to sell. From the start, having the endgame in mind for all of their investments is what investors need. Selling as an investment strategy allows the focus to shift from buying properties to hold and rent to buying properties that you plan to sell within a shorter amount of time. “Flipping” a house means buying, renovating, and selling the property quickly. This is a common way to prioritize selling as an investment strategy.
But flipping houses isn’t the only strategy investors utilize to profit from rental real estate. There are investors who will find bargain properties that need only minor updates, and that would be enough to make great rental homes. Suppose the value goes up, either due to improvements or market appreciation, or both. In that case, 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 hassle of obtaining a property ready to rent. This strategy, of course, will only work if the purchase price is low enough or the market appreciates fast enough to cause the desired return.
Renting as an Investment Strategy
Another common investment strategy to gain income from real estate is to buy properties to hold and rent. This approach is generally viewed to be a much more effective strategy for long-term wealth building. This strategy allows investors to profit from rental houses by collecting rental income every month and then again when the property is eventually sold. Although the year-over-year financial gain might not look as big as the proceeds from a sale.
The financial gain 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 evade any severe economic downturns. Buying to hold and rent is presumably the best option if you have the time to hold property and prefer stability over quick payoffs.
Invest Like a Pro
Likely the biggest reason some investors don’t find the buy-and-hold strategy preferable is having to manage tenants. It has often expected that rental homes are managed by property owners, and a lot of them are not professional landlords and have little property maintenance skills. Though as Glenview professional property management companies have been getting bigger and improving, more and more investors are looking to the experts to help them expand their profits. If the only reason you want to sell investment property is that you’re worn out from dealing with bad tenants, it may be time to hire a professional Glenview property manager to do the job for you.
At Real Property Management Chicago Group, we make certain rental property owners like you build real wealth through real estate investing. To learn more about the services we offer, contact us online or call us at 312-265-0660.
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