Investing in Real Estate

Real Estate has become much more than just a place to call home as it has become a common investment vehicle. There are plenty of opportunities in today's Real Estate market. The downside is buying, owning and maintaining real estate as an investment is more complicated than buying or trading stock.

Real Estate rental properties: The practice of landownership is one of the oldest investments. One person buys the property, called the landlord, and another person rents, the tenant, the property. Ideally the landlord would want to charge enough rent money to cover the cost of the mortgage, real estate taxes and maintenance on the property. Sometimes the market cannot support this much in rent and this scenario would be referred to as a negative cash flow. If the landlord is fortunate enough to cover all expenses and secure a profit this is called a positive cash flow. Real Estate investments also can be excellent tax benefits.

When the mortgage is paid the property can become income bearing and of course over time will have appreciated in value and the landlord will realize a large profit when it's time to sell the property.

There are of course sometimes hurdles to overcome. The landlord should have a fund for vacancy times, for maintenance and replacement of certain items. These hurdles could become a hardship for the landlord if not prepared for.

Some investors own many real estate properties and hire Property Management companies who handle all the miscellaneous items that arise.

Real Estate Investment Groups: Real Estate investment groups are like small mutual funds that combine their assets to purchase Real Estate investments. This is the perfect solution for the investor who does not want to be a landlord. The company who manages the investment group collectively manages all the real estate. A single investor can own more than one investment unit. There is usually a reserve fund set up where each unit owner contributes an equal amount of money for each unit owned which is used for the maintenance, repair or replacement and advertising for new tenants.

There are many quality investment groups however they can be as vulnerable as the mutual fund industry so do your research or get guidance and recommendations from a financial planner or attorney. Of course your local realtor can assist you in finding the right properties to invest in.

REITs: Real Estate has been around since our cave-dwelling ancestors so it's not a surprise that Wall Street found a way to turn real estate investing into a publically traded commodity. This is a Real Estate Investment Trust and it is created when a corporation uses investors money to purchase and operate Real Estate income properties. REITs are bought and sold just like any other stock on a major exchange.

These trusts are a solid investment for stock market investors that are looking for regular income. REITs are an excellent opportunity to invest in commercial Real Estate like office buildings, apartment complexes, strip malls and other like type properties.

I was born in Belleville, Essex County but spent my formidable years with my grandparents in Teaneck, Bergen County. I am the oldest of six siblings, "blessed" with five younger brothers. Have you ever heard the saying? "Every thing in life has a purpose". I know that God's master plan was to prepare me for my career as a Real Estate Manager and Broker! I have to admit that today it is great; our rolls have reversed and the "boys" are always looking out for me! My daughter Jennie is now thirty-three, married to Dwight, my son-in-law and just recently they have blessed me with my grand-daughter Sarah Rose, hence the name of my Corporation. More...