When done correctly, property investments can be quite lucrative. They serve as an additional stream of income that could aid in diversifying your current investment portfolio as well. The issue is often the fact that most new investors don’t exactly know how or where to invest their funds when it comes to real estate. This industry offers a number of different investment options, and here are just some of the best solutions that will make investing in property easy for any novice:

Think about buying REITs

Real estate investment trusts (REITs) enable you to invest in real estate without worrying about physical properties – conventional loans and down payments won’t be a concern. These funds represent companies that own real estate like retail spaces, office buildings, hotels, and apartments.

REITs often pay high dividends, making them a good option for reinvesting when it comes to investors who prefer growing their investments further rather than getting a regular income. REITs can be quite good investments, but they’re also complex and varied. The amount of risk you’ll be taking on will depend on the type you purchase. Publicly traded REITs are generally recommended for new investors.

Consider rental properties

If you have some DIY renovation skills and the willingness to manage tenants, rental properties can present another great opportunity. This strategy can provide you with a regular income, the property can appreciate over time, you might manage to increase capital through leverage, and there are a number of tax-deductible associated expenses. However, it doesn’t come without its drawbacks either. When investing in rental properties, you might find managing tenants challenging, you could potentially experience property damage, and income may be reduced from vacancies, not to mention the initial maintenance and repair costs.

Leverage the right tools

As the real estate industry evolves, technology begins affecting all aspects of the business. While investing in related startups might be an option, a better solution would be to leverage these new opportunities to make property investments easier.

For example, you can use investment apps for property search and analysis, find new investment opportunities with tokenization, or use crowdfunding for purchasing commercial real estate. It would be a good idea to hire a property investment strategist online as well. They can help you purchase the right property, at the right time, in the right market with the use of unique research methodologies.

Utilize online platforms

Online investment platforms for real estate aim to connect investors who’d like to fund projects with real estate developers, and are usually used for bigger residential and commercial deals. Investors will often receive quarterly or monthly distributions, but they do have to pay a fee to use the platform and take on quite a large risk.

These investments are illiquid and speculative, meaning you won’t be able to unload them very easily. In certain cases, you will be able to diversify your investments with these platforms without too much money. The main downside of real estate investment platforms is that some of them are exclusive to accredited investors.

Try flipping properties

Known as house flipping, this strategy involves purchasing underpriced properties in need of work, renovating them using as little funds as possible, and then reselling them for a profit. Unfortunately, flipping is a bit harder and costlier than it used to be, due to the more expensive building materials and higher mortgage interest rates.

A big issue with house flipping is that it requires quite an accurate estimate of how long repairs are going to last and how much they will cost. Having enough time and capital and partnering with the right contractor to manage the project and estimate expenses will be key here.

Consider renting out a room

For those wanting to explore the world of real estate while minimizing risk as much as possible, renting out a room or another part of the home is also a solid option. This arrangement can significantly reduce your housing costs, while allowing you to benefit from any price appreciation on your property.

Adding roommates could make mortgage payments easier for younger individuals as well. If you’re not ready to commit to long-term rentals, websites such as Airbnb can allow you to test the waters without too much commitment and remain protected against damages by the website.

The right real estate investment opportunities are those that serve you the best. Weigh your options and choose a solution that suits your funds, preferences, and overall goals the most.