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Real Estate Investing

     Real estate investing can be a great way to gain capital, establish your financial future and maybe even get rich. Whether you're a novice or a connoisseur, real estate investing can be a challenging and exciting way to make money. When it comes to real estate investing, your biggest resource is your ability to research.

     Depending on your income, assets and credit history, it may be quite easy for you to get an investment loan. Investment loans work somewhat like mortgages in that you can be pre-approved as well as rejected, depending on the aforementioned factors. In the investment world you will not be taken seriously unless you have the financial resources to back up your proposed interests. In order to obtain a loan, you will have to go through the same credit, history and income verification process as individuals who are buying a home (see Getting Approved). The only difference is that you may be receiving up to ten times as much as them; making you financial history much more relevant to your approval.

     There are two types of preliminary investment mortgages, the first is pre-qualification; when you pre-qualify for a loan the lender is not bound by any obligation to you. You probably haven't even filled out a loan application; just an initial credit check. This form of qualification will get you a pre-qualification certificate. The second type is pre-approval; this type of approval is guaranteed by the lender and entitles you to purchase property worth the amount of the approval certificate. This pre-approval period lasts anywhere from two to three months, depending on the lender.

     When it comes to real estate investing, you have to get approved before you start shopping around; vendors will not take you seriously if you don't have a pre-qualifying of pre-approval certificate from a certified lender.

     Once you have been approved you can start to shop. There are many different types of investment properties and as such you may want to hire a real estate agent that specializes in investment properties and maybe even an entire team (see, Who to Hire).

     Any property you buy with the intention of receiving a future profit is considered an investment property. There are as many types of investment properties as there are styles of homes, and as such, you should be aware of all your options. The following is a list of assorted types of investment properties you may wish to consider.

Apartments: Apartments are a great investment opportunity. It is said that there are more apartment buildings in North America than industrial, retail and industrial properties combined. Though the market value and vacancy rates of apartments fluctuate, they are considered one of the best investment properties. There are four types of apartment buildings; the garden apartments, which are one to two story buildings. The walk-up apartments, that has three to five stories. The mid-rise apartments, that has six to ten stories, and finally, the high-rise apartments that has more than ten stories. Benefits of investing in apartment buildings are as follows:

* An apartment building's value will usually increase more than other investment properties
* Most apartments come with a staff, and as such, require little interference by the owner
* Having revolving tenants may prove to be beneficial

Aviation: Once in a while an investor may come across a piece of aviation property for sale. Such properties generally have permanent fixtures such as hangers, storage facilities and possibly a functioning airport tower. To the right investor, this type of property is a gold mine. If you know what to do with it, then by all means. However, if it is a non-functioning aviation sight, you will have to attract clientele in order to make a profit, or use it for its land.

Commercial: Commercial real estate includes, but is not limited to, retail, hotel and industrial properties.

For Sale By Owner (FSBO): The main reason an investors will buy homes directly from the owner is to sell the property immediately after the sale. Some investors may renovate and then proceed to sell it, or they may choose to rent in out; depending on which one is more economically rewarding. Because FSBO are sold by the owner, you essentially eliminate any middle men, saving both you and the vendor money. As an investor you are more likely to purchase a home FSBO than the average homebuyer.

Foreclosures: Homes become foreclosed when the occupants of the residence fail to pay either their mortgage or their property taxes. Locating foreclosed homes is a easy as contacting your local government housing authority. They will provide you with a auction list that indicates the date, location and time of the auction. Sometimes these home are so cheap that you don't even need a loan to buy them.

Industrial: Unless you are on the 'inside track' of the industrial business you will rarely hear of industrial units coming up for sale. They are often bought out by larger competitors, so they never even make it to market.

Retail Properties: There are three types of retail properties; shopping centers, strip malls and free standing units. There are six types of shopping centers:

* The super regional center, which has more than three department stores, and is often 750,000 to one million square feet
* The regional center which has one to two department stores, and a variety of smaller stores. It is generally larger than 300,000 square feet.
* The community center, which contains a grocery store, children's stores and a convenience store. It is usually larger than 100,000 square feet.
* The neighborhood center, which is built around a supermarket and/or drugstore, it is between 30,000 - 100,000 square feet and is intended for the convenience of those who live within walking distance.
* The convenience center, which is row of stores; 5,000 - 40,000 square feet each.

     Making an Offer to Purchase an investment property is essentially the same as making an Offer to Purchase a home (see Making an Offer), as is closing the deal. Unless you are an experienced real estate investor, you will not want to go this route alone. If investing is truly your passion and you are confident that you can handle all the pressures associated with it, then you should firstly, protect all your personal finances; in the even your loan defaults and secondly, hire an entire team of specialists who 'know the ropes'.

     If you are a successful investor, than the economic payback will be far greater than the initial investment amount, in turn, allowing you to continue turning over your money. After the initial investment is paid off, everything else is profit.

     There are many 'investor' specific web sites on the Internet, each catering to a specific type of investor. Now that you have the basic information you may continue to research, because you ability to research is your best resource.