Real estate is the one of the best ways to maximize your wealth. Here are a few ways that savy investors use real estate to become wealthy:
1. Income Investment Real Estate
The priority of an income investor in Durham Region is to optimize cash flow. This is when the cash made on the investment on an ongoing basis—either through monthly rent or yearly leases—is the focus of the investment strategy, not the long-term potential price appreciation. This type of real estate investor is more concerned with stable, secure returns. This type of Durham Region investor isn't necessarily concerned with the quality of tenant they are bringing in, as long as the lease is being fulfilled and rent is being paid on time.
2. Flipping Real Estate
Durham Region Investors searching for opportunities have one goal: To maximize profits in the shortest timeframe. These investors typically take on a great deal of risk in an effort to juice returns. A good example of this style of real estate investment is the renovation contractor who buys a run-down bungalow with the intention of rebuilding and reselling. This “flipping” of an outdated residential home is usually done in a short timeframe with the sole purpose of making the most profit. More and more Oshawa / Whitby investors are searching for the "flipper" which makes finding the hidden real estate gem, before anyone else finds it, that much more challenging. Ideally a home that is listed privately or one that has not been listed with a real estate brokerage, often offer the best opportunity to flip.
3. Longer Term Real Estate Investment
Someone once owned all the land that borders Highway 401. Now, there are housing developments, commercial stores and other amenities on either side of this very busy highway. Development investors aim to buy raw land, which they then develop into a major hub by building residential or commercial projects. We now see many investors recognizing the impact of the 407 in Durham Region. These savy investors are buying up properties that may not appear to hold value at the present time, but in the future will see signifcant increases in value.
4. Using debt to make money
The last way Durham Region real estate investors will use real estate to juice their investment returns is to go into the money-lending business. Using their own capital, these investors fund mortgages or lend capital to developers and builders. In exchange, they get a bigger-than-bank-rate returns, as well as the security of an asset-backed debt. This is one of the most advantageous ways to invest in real estate, as private lenders can usually expect anywhere from 6% to 16% return on the money they loan out and the land or building is still collateral protection in case the borrower defaults on the loan.
How can I invest in real estate?
This all sounds great, but the real question is: How can I get in on it? I mean, who hasn’t suffered a bit of envy watching housing prices in Durham Region skyrocket in the last decade?
Truth is there is no simple answer to this question. Real estate investments, just like stock market investments, require due diligence and research.
If you are a real estate investor looking to purchase investment property in Whitby, Oshawa, Courtice, Uxbridge, Bowmanville, Courtice, or anywhere in Durham Region, contact Team Bryant today. James Bryant and Patrick Bryant look forward to helping with all of your Durham Region Real Estate Needs.
