Is Real Estate Investing A Good Investment?

In the world, there are many commodities that people can invest in. One of the best ways to achieve financial freedom, self-success, and education in life after college or high-school, is investing into real estate. Investments are great assets to have no matter the gender, age, or social class. Real Estate investing can be a very who finally wants to commit, as it takes discipline and maximizing your efforts to become successful in real estate investing.

Real Estate Investing, a buying or selling of a property to collect income off of the investment.

From houses to condos, investors come across a property that they would think is buyable or sellable, and then proceed to embark their way onto owning a new investment or getting rid of an old investment. In Real Estate Investing there are two people, the investor and the tenant. The tenant pays rent to use something that someone else owns, and the investor is the person who either buys and sells or buys and holds a property.

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Real Estate investors make money from the income of their properties and/or from the growth of the property value. Real estate investing requires a plan, both short-term and long-term. A short-term goal for example would be for something that an investor would want to accomplish in less than a year or setting up monthly goals to reach a yearly goal. For a long-term goal, real estate investors would probably plan for where they are financially in three to five years.

In America, “only 15 percent of Americans are investing in real estate”, yet the efficient way to start out in real estate investing is by investing in your own home. However, this may sound fantastic, it’s more benefitted towards mid-aged civilians or people who’ve considered going into real estate.

According to Abhi Golhar, a managing partner in Summit and Crowne, in the article, Why Real Estate Investors Should Consider Lease-Options (2017), the best way to get started in real estate investing is buying a lease-option, “a rent-to-own” concept. Lease-options gives the investor and tenant time to decide or agree on whether a property will be bought. Some real estate investors start out with loans from a bank, buy REIT’s, or invest into rental properties. Among the three, the easiest is rental properties because of the tax benefits, due to tenants paying the taxes, and due to increased cash flow from rent income. Probably the most important aspect of starting out in real estate investing is to invest in a mentor. A mentor will guide a rookie investor in the right direction to buy their first property, sell their first property, and what properties are best to buy/sell in the short and long term. Mentors are more experienced and are determined to help new investors become successful. Starting out in real estate can be an easy thing to do but with multiple real estate benefits, they provide they’re own challenges and rewards.

Real Estate investing provides more benefits in one year than what a real estate agent or broker would in five years. Anum Yoon, a writer who's passionate about personal finance, in the article, Why You Should Consider Real Estate Investing As Early As Your 20’s (2016), explains that people who start real estate investing in their 20’s are more likely to succeed in investing than someone who starts later in their life. Yoon expanded on the fact that young adults are still learning and at a young age, trying to figure the world out, that “investing in real estate while you are young gives you an education.”, this teaches young adults to really assert themself with independence and self-success. With this freedom, investors can also ponder about going into real estate investing as a full-time career. Investing isn’t always a full-time job, most of the people who still work a full-time job and invest part-time. Part-time investing opens the mind of the curious person to get a sense of whether they should consider investing. For example, JD Esajian, President and Co-Founder of CT Homes LLC, writes in the first sentence his article, A Beginners Guide to Part-Time Real Estate Investing (2017), says that investing in real estate can be a risky but rewarding commodity. Part-time real estate investing means that the investor wouldn’t have to treat their investment as a priority as to someone who’s a full-time investor. With that in mine, part-time investing also means that investors can’t afford to lose in their investments than a full-time investor because they’re more likely to invest in a shorter value of housing which accumulates to an investor buying/selling more in a shorter amount of time.

Part-time investing is also a perfect way to use time-saving hacks and tips from successful real estate teams to experience what a committed, full-time investor endures daily, and could set up possible future success in real estate investing. The main benefit would be financial freedom. Financial freedom or financial independence is summed up by being prepared to make life decisions without stressing over the financial impact. Linda McKissack, in her book, HOLD: How to Find, Buy, and Rent Houses for Wealth (2012) explains how to start real estate investing and how to make earn money without having money. McKissack says people who have an interest in real estate investing should “be an investor, not a speculator” meaning to take the risk to achieve financial freedom. Suze Orman, a financial advisor and author, in her book, The 9 Steps to Financial Freedom (1997) says “a big part of financial freedom is having your heart and mind free from the what-ifs of life.”

In the field of Real Estate, it’s a business, yet in school real estate is more than a business. There are many aspects of learning real estate, whether it be through finance, business, or economics. Unfortunately, there is no specific major in college for real estate investing. Mainly, a person could go to community college and get an associate degree in finance and still be able to invest in real estate. There is no specific education for real estate investing, but majors such as finance or business is helpful for investing. With an education in mind, many people who want to pursue real estate, usually obtain a real estate license. A real estate license allows for real estate agents and brokers the ability to represent a home buyer or seller in the process of buying/selling real estate. A real license is mainly required for agents and brokers because they’re job is to show a home to a tenant and see whether it’s a property worth purchasing. In real estate investing, a license is not required due to the fact that investors aren’t trying to get people to buy or sell properties, yet work with the tenant to invest, buy, and sell a property. A real estate investor can still obtain a license if they really wanted to, in fact, if an investor had a license, it would only improve their stature.

In a way schooling isn’t necessary for all subjects of real estate and doesn’t affect an individual’s credibility negatively or positively.
In the real estate industry, it has a major effect on the economy as the economy does in the business industry. Real Estate benefits the economy from the housing, marketing, and financial aspect of the business. “Residential real estate provides housing for families…Commercial real estate creates jobs and spaces for retail.”, says Kimberly Amadeo, M.S in Management, in the article, Real Estate’s Impact on the U.S. Economy (2019). Real Estate investing aids the well-being of the economy that isn’t measured, for example, “a decline in real estate sales eventually leads to a decline in real estate prices.” This meaning that essentially any decrease in a product will accumulate to a decrease in production which leads to fewer sells. Real Estate investing was also affected by the 2008 Recession. In 2007, investors were “more likely to default”, which led to a decline in real estate investors. During the recession, homeowners weren’t losing much equity out of their homes, yet real estate investors gained better cash flow due to low home prices and less money that needed to be loaned for repairs. However, “predicting the economy will enter recession territory in the next two years” according to, Suzanne De Vita, an online news editor at RISMedia, in the article, How Recession-Proof is Real Estate? (2018). This recession would benefit real estate investors by having them move their equity to increase the cash flow and inventory of any property they might own.

Real Estate investing is broken down into small parts of its own inventory which creates bigger rewards than its counterparts. The independence of someone working at their own pace, time, and checking in and out on finance. A career in real estate, more specifically investing, is the riskiest, yet the most rewarding in the fact that it's all self-dependent. Self-success equals high credibility, real estate agents can achieve this after 20 years of mastering their craft, and brokers in 15 years. Real Estate investing is by far one of the best ways to get you to where you want to be in life, whether its financial success or self-success, it is an important asset to partake and the opportunity is endless.