There is no debate when it comes to the positive repercussions and financial freedom you can reap from investing in real estate properties and/or establishing a full time real estate business. Whether your goal is to achieve short term financial gains or save up for retirement, be rest assured real estate is the way to go and you can make money fast in real estate investing if you play your cards right, i.e., choose a prime location in a strong market, buy under market value, hire the right real estate agent, work towards high cash on cash return and positive cash flow, choose the right tenant, etc. To make money fast in real estate investing, you must study the housing market, understand how real economic conditions affect real estate on a whole, run real estate market analysis, and measure real estate metrics (i.e., cash flow, cash on cash return and cap rate) to assess your rental properties’ value in the long run.
Five Ways to Make Money Fast in Real Estate Investing
1. Location location location
Investing (i.e., buying an investment property) in the right location (including the right housing market) is one of the best ways to make money fast in real estate investing. The holy grail of real estate investing is finding a prime location to buy an investment property (preferably under market value) and reap a steady flow of rental income. Choose a city with the highest real estate investment potential and invest in a good neighborhood that is safe with easy access to public transportation, shops, and entertainment facilities. Perform real estate market analysis to know the fair market value of your property purchase. Investment properties in good locations appreciate in value over time and sell for much higher later on, earning you a big fat profit. Whether you choose a single family home or a multi family home for your investment in rental properties, location location location is key to materialize high demand for your property, earn you high rental income, and achieve high profitability (cash on cash return and cap rate) in turn. If you are starting out in real estate, we recommend you hire a professional real estate agent with good experience and knowledge in the location of choice.
2. Buy rental income properties for long term gains
Besides the benefits of appreciation and tax benefits, buying a rental income property in the right market is a great way to make money fast in real estate investing. By buying an investment property not only are you guaranteeing positive cash flow returns every month, but you are securing a long term investment that will pay off your mortgage payments. The goal of investing in long term rentals is a steady cash flow and monthly income; our advice is to buy investment properties under market value (with the help of a reputable real estate agent), renovate and repair your rental properties adequately to increase value, and choose homes that will give you high cash on cash return. Beware that it might take you few months to find the right rental income property; it won’t happen overnight even if you hire the best real estate agent in town. Also, make sure you run a thorough background check to find the right tenants to avoid the risk of vacancy.
3. Invest in real estate through wholesaling properties
Wholesaling properties can be a great way to make money fast in real estate investing without necessarily buying rental income properties. Simply put, wholesaling investments are about selling a home to another real estate investor without buying and repairing the house. This is fast money because these wholesaler properties get sold very quickly and you can guarantee hundreds of thousands of dollars a month. Moreover, real estate wholesaling is a good investment idea for those who are just starting out in real estate with little to no experience and initial capital (as you are not actually going through buying an investment property). Consider wholesaling as a good start in real estate investing by choosing the right investments that will earn you good income.
4. Use your home for short term rentals
Another way to make money fast in real estate investing is using your own home to rent out. Short term rental websites like Airbnb allow anyone to rent out their home for short duration to earn quick cash or make for a good source of income. Win-win! Do not be misled though, it is no easy task managing short term rental properties and it requires more work than you may think. Nevertheless, you do not need to buy and finance a new rental property to make money, so Airbnb might be the way to go for you initially. With Mashvisor, you can easily figure out the rental income you can earn from renting out your home in your location. Give it a try and see how real estate investing can start at your own doorsteps without the necessity to be buying rental income properties at first.
5. Make money from vacation rentals
And the last way to make money fast in real estate investing is through owning a vacation rental in strategic and touristic locations to earn you good income at cyclical periods. The good thing about renting out vacation homes is the high rent you can charge; however, vacation homes used as short term rental properties won’t be a steady stream of cash flow like long term rental income properties. Peak season can make you lots of cash flow, while regular or low season can be a struggle with little or even negative cash flow. You can charge high rent when there is good demand for your property, but consider to price your vacation rental low enough (in line with the market) during low season to keep the units rented. We do not recommend you buy a vacation rental as your first time investment property. Instead, when buying an investment property for the first time, opt for a single family home (under market value) to kick start your real estate investing career with rental properties.
Quick Tips and Tricks to Make Money Fast in Real Estate Investing
1. Buy an investment property under market value
2. Overestimate your expenses
3. Underestimate your rental income
4. Do not be haste when hiring a real estate agent
5. Pick the perfect tenant
6. Make sure your credit score is in check for a mortgage before you start hunting for your investment property
7. Do no discount foreclosed homes
It goes without saying that the real gains and value you receive from investing in the right investment property that will earn you passive income and high cash on cash returns can be significant. With the economic conditions looking sunny side up, 2017 is a great year for investing and buying your first rental property. Do not miss out on the real gains of real estate, so head over to Mashvisor to begin to make money fast in real estate investing today!