Different types of real estate investments
When you think of real estate investments there is a good chance that you are going to think about the traditional buy-to-let approach. Whilst this is still a tried and tested method that has worked for many people, real estate is ever-growing and changing.
This means that there are a variety of different types of real estate investments that you can choose from if you want to get into the world of property.
To help you to decide which approach might work best for you, here is our guide to the different types of real estate investments.
The traditional buy to let
Talking about the types of real estate investments, buy-to-let is one of the most common ways that people invest in property and this is with good reason. Renting a property out is a way to bring in a regular income and it can be a long-term measure that can help you financially over an extended period.
Of course, you do need to carefully think about whether or not buying to let is the right approach for you. You want to buy a property that is going to be easy enough to rent out, that is going to be popular with prospective tenants and that is also going to give you a high rental yield too.
You also need to think about becoming a landlord and the roles and responsibilities that come with renting out a property.
HMOs
Another option if you want to rent out a property, is to own and let out a HMO (house of multiple occupancy). These are properties that are a singular house, but that is broken down into many bedrooms that are then rented out to tenants separately.
The facilities within the house are shared, such as kitchens and bathrooms, which means that the tenants in the house will come together to use these things.
HMOs can be tricky to run and you are going to need to make sure that you own the right house to have enough space for the people that you are trying to appeal to. You also need to look at the rules for letting out an HMP and whether or not you need to apply for any licences.
Holiday lets
If you are looking to invest in a property that has something a little different to offer, then you may want to consider holiday lets. The idea of a holiday let is that it is a property that is rented out for a shorter term, rather than a long term.
They are often provided completely furnished, as this will allow the tenants to enjoy their break in a home-from-home setting.
The great thing about owning a holiday yet is that the money that you can make from them is much higher than you could from long-term lets. This is because you will be able to charge by the week or the weekend rather than a month.
It is important though, to remember, that there can be times when holiday lets are left empty (usually because it is out of season) which means that there may be fewer people looking to travel to the area and renting the property.
These are just some of the options that are open to you as a property owner. You need to consider which one is going to be the right one for you, both in the short-term and also the longer term too.
Ideally, you want something that is not only going to secure you a good level of return, but that also is going to fit in with your life and be as easy as possible to manage too.