Real property investing is an excellent method of building wealth. It can be daunting for new investors. This article offers real estate investing strategies terminology, tips, and suggestions for novice investors.

There are many real estate investment strategies. One of them is the “buy and hold” strategy, which entails purchasing and holding properties for longer periods of time in order to benefit from property appreciation and generate passive income through rental payments. This strategy could be a hedge against inflation as rents can be adjusted in order to keep pace with inflation or even outpace it. It also allows you to diversify your portfolio of investments.

Another real estate investment strategy, also known as a core strategy, involves the purchase of fully leased properties with “high-credit” tenants and relying on only a small amount of leverage. This strategy is more secure and a more stable cash flow than other strategies, but it also usually has less potential for capital appreciation.

Value-add investments involve purchasing and renovating properties that are below market value, typically those with management/operational issues, capital constraints, or physical problems. These properties are then sold for profit. This strategy is moderate to high risk, but offers higher returns than core investments and has the potential to earn significant gains.

Finally, there is the option to invest in REITs (real estate investment trusts), which are companies which purchase and manage income properties and publicly trade on major stock exchanges. This strategy provides a broad real estate exposure, and has a low correlation with other asset classes. However it does not give the same tax benefits or direct control like owning your own property.

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