You don't have to be a millionaire or even buy a property to be part of the wealthy real estate industry. Find out how to invest in this sector without buying a property!
Many people think that investing in real estate is complicated and that it implies that you should actually buy a property. Nevertheless, there are many other and much more simpler ways to invest in the sector. Here are some very interesting options you should consider if you want to invest in real estate:
1. Real Estate Crowdfunding
Raising money through crowdfunding has become an option for small businesses, and these include real estate companies! By crowdfunding, the real estate sector allowed any kind of investors to participate in the industry.
In this case, your money is pooled by the fund managers to buy either a single property or multiple properties. Then, the profits of operating or eventually selling the real estate is divided among the group of investors. If you don't know how to join a real estate crowdfunding, you can start by searching for special platforms, like Fundrise and DiversyFund.
Check which platform suits your investment best. Some require a minimum investment of $500 and allow you to direct your money to a diverse portfolio of properties.
2. Real Estate Investment Trusts
Real Estate Investment Trusts (also known as REITs) are companies that currently own and operate in the Real Estate sector. You can invest on this kind of companies by buying shares. This way, you actually own a piece of a company that owns properties.
It works similarly to crowdfunding. In this case, your investment is pooled along with other investors' money to buy properties. The company manages it, while you receive benefits from the cash flow and the properties' appreciation.
REITs work with different kind of real estates, such us housing, office and industrial buildings. So, you can choose in which kind of property you want to invest in.
3. Real Estate Money Partner
If you don't have that much money to cover an entire real estate investment, but you still want to be part of the industry, then you can find a partner. When finding a "money partner" you can invest your cash while your partner manages the rest of the deal, like the renovation or operation of the property.
Although it may seem like a loan, you are actually joining an equity partnership and will receive a part of the total profit.The better you know your money partner, the better. But you can still find a partner you haven't met before and have an excellent business experience. In any case, don't forget to write down the terms of agreement of the partnership!