Career & Finance

5 Ways To Invest In Real Estate Without Buying Property

Doing business without selling in the business


The key to having a successful portfolio is to engage in different investments, and one of the most lucrative is Real estate Investment.

Real estate investment is a great way to have a solid, diversified portfolio. However, purchasing and trading off real estate is typically expensive and risky. If you consider the down payment, the insurance coverage cost, the maintenance cost and the monthly mortgage payment involved, it is almost a no-go business area. Besides, the negative impact of the housing crisis a few years ago is still being felt, and the last thing you want now is to put a considerable amount of your money in a business that is not promised tomorrow.

BUT…wait a second, buddy!

You can invest in real estate without actually buying a single property!

Unbelievable, isn’t it? Yes, it is! You can make money from investing in real estate without buying or selling any property. This is doing business and making money out of it without actually buying or selling anything while in it. Who doesn’t want that?

Now, grab a seat, shut the world before you and pay apt attention! School is in session and the topic today is “5 ways to invest in real estate without buying a property.”

Let’s hit it!

5 Ways To Make Money In Real Estate Without Buying A Single Property

1. Put money into REITs (Real estate Investment Trusts)

One of the best ways to make money in real estate without buying a property is to invest in REITs.

A REIT connotes a company that either finances or owns a real estate that generates income. These companies commit most of their money into real estate, which also accounts for the majority of the income they make.

You can invest in REITs by purchasing shares. While the majority of REITs are equity operate as equity REITs, a good number of them trade in mortgages instead of actual properties. The good thing for the investor is that such REITs pays about 90% of taxable income via dividends to the shareholders. Thus, if you stand a chance of making a good profit, provided you carefully research REITs that thrives.

2. Partake in real estate mutual fund (REMF)

There is a thin line that differentiates REITs from Mutual Funds. While REITs are real companies, mutual funds or REMF for short, refers to investment pooled together and is managed by an investment manager.

Investing in REMF allows you to have a diversified portfolio in the sense that you have a mutual fund and also a real estate. REMF also allows you to select the ones that are income or growth-oriented. The benefit of mutual funds in being a diversified asset is that they are deliberately designed to mitigate risk, although they are still open to the risk typically associated with real estate, however on a much lower rate.

3. Wholesaling Houses

Another way you can invest in real estate without buying a property is by wholesaling a house.

Wholesaling a house in this context means contracting a homeowner who is looking to sell his home. Then take the contract from the homeowner and sell the house to a prospective buyer for a profit (exceeding the agreed rate with the homeowner), which you keep as your gain.

Wholesaling real estate is somewhat similar to property or home flipping, but, the good thing is that you are not the owner of the home and you don’t get to perform any maintenance cost.

This type of real estate investment is the best in that you have nothing to lose as you are not putting a dime into the deal. However, finding an undervalued home or property in the market that you can sell for profit can sometimes be like looking for a needle in a haystack.

4. Invest in real estate pro companies

There are thousands of companies whose primary focus is on real estate. You can invest in any of these companies.

While REITs are always a good place to start, you can look beyond them and invest in other real estate service companies like Etsy Real Estate Company that value homes for homeowners who want to sell, and sell homes through real estate agents. When you get involved with a real estate pro company that value homes and help to people sell their homes without buying them can help diversify your portfolio and also form an intelligent view of the real estate market.

5. Pitch tent with home construction companies

Another good way you can invest in real estate without buying a property is to get involved with companies that build homes.

The New York Stock Exchange (NYSE) records thousands of stock trading of different construction companies, like Comstock Holdings Companies Inc and MDC Holding Inc.

This can be an intriguing investment option if you are among those that believe that home construction is a phenomenon that never seizes but will continue to grow because if that is correct, the business should continue to boom.

Rounding up

If you have no interest in purchasing real estate, but you love to reap from the huge pool of profit inherent in real estate, then using the above ways can add real estate to your portfolio with very little or no risk of suffering losses. With these five ways, you can do the business you always wanted without getting your fingers burnt.