Investment in real estate is not very difficult if the right choices are made. But for that to happen one needs to know how to identify the investment requirements one has and what strategies one would follow to get the highest returns. Real estate developers like Eugene Bernshtam have been in the industry long enough to understand that an investor should consider a few things before attempting to invest in real estate.
The objectives one has in terms of expectations concerning investments largely maneuver the choice of the kind of investment that one makes. Once this is decided the type of real estate where the investment is intended to be made is selected from among the residential, commercial, REITs, raw land and new construction, and crowdfunding platforms. Beginners should start by considering the residential real estate category. This encompasses the family units, both single and multiple along with the apartments and duplexes. People mostly buy these to give them out on rent or sell them to other homeowners who intend to increase their assets.
The location of a piece of property also plays an important role in helping one decide their investment strategies. The other crucial factor that helps in strategizing real estate investment is to decide whether to be actively or passively involved in the process. Active investment, as the name suggests, is about being more closely involved in the investment process. The focus is more on the management of the investment. Rehabbing a house is an example of an active investment as would know Eugene Bernshtam the real estate developer who specializes in
Commercial Property Development
This implies that the investor will be actively responsible for coordinating the renovations, overseeing the contractors, and making sure that the property is ultimately sold. This, thus, goes without saying that there also has to be an intense investment of time and effort in this process. As opposed to this, those who prefer simply giving the investment amount for the property and then staying aloof, for them opting the passive investment strategy is appropriate.
Example of such passive investment includes REITs, ownership of rental property, and buy and holds. In this form of investment strategy, informs Eugene Bernshtam who heads Avalon Holdings LLC, the investor does not have to put their mind into how the investment is multiplying itself.
Someone else manages the investment and the concerned real estate, in most cases either a company or an individual property management entity. The individual who selects the passive option enjoys the returns from time to time, however, the downside to this is that they also have to shell out a decent amount of money for the management entity for their property.
A thing similar to this kind of strategy of investment is the direct and the indirect form of real estate investment. This is also about the level of involvement of the individual. REIT and crowdfunding platforms are indirect forms of investments while when one gets involved in the purchase and managing of the property, it is known as the direct form of investment.