A lot of people like investing in properties because of the low risks they carry. When you buy a house or an apartment, you can use it in a plethora of ways. For example, you can rent it (if you want long-term revenues) or flip it (if you’re looking for a short-term profit).
The idea of having passive income is alluring to just about anyone. Even if you one day decide to stop renting, you can still sell the house, thus regaining the initial investment.
In this article, I will go through 5 incredible ways to get more money from a property. Whether this is an old family house or a newly bought apartment, there are lots of ways to generate revenues from it. Some of them are pretty simple and straightforward, while others are a bit more complex and might require an additional investment.
1. Long term renting
When we talk about properties and ways to make money out of them, most people think of long-term renting. This is the simplest approach that doesn’t require much work. Ideally, you should find tenants willing to sign long-term contracts lasting one year and more.
The great thing about long-term renting is that this is a reliable income. You know how much money you’re going to get each and every month, which is crucial for homeowners who don’t have other sources of income. It can also be important for business people who want to invest this money in other projects, and they need to know how much cash flow they can generate on a monthly basis.
If you choose to go with short-term renting, there is no better way to do it than going with Airbnb. This platform has completely changed the face of real estate, allowing tourists to rent apartments for a few days. In fact, more and more people go with Airbnb instead of traditional hotel reservations.
To maximize your profits on your AirBnb listing, it is crucial to have positive reviews. Having great reviews makes it easier to attract new visitors, but it also allows you to slightly increase the prices without investing too much into the property.
Despite all of its advantages, running an Airbnb is a full-time job. Given that you have to welcome all these visitors who arrive every few days, you will have to go to the apartment and continuously clean the mess that the previous visitors left.
3. Flipping a property
Flipping a property is another approach that requires investing time and money. The results are that much better if you have construction skills and if you can supervise the project or work on it. For the most part, property flipping is regarded as a safe approach that can make you lots of money in a short period of time.
However, there are a few things you need to consider before starting the project. It is much better if you can buy a house in a nice, residential area. In the end, once you perform the refurbishment, you will need to sell it to someone.
When assessing potential profits, you should consider the prices of all the properties in the neighborhood. Then, reduce this potential price by the price that you’ve paid for the property, as well as all the accompanying costs. That way, you can approximately determine how much money you’re going to get from the project.
4. Reverse mortgage
The reverse mortgage is a concept that has become more popular as of late. It is especially common among the elderly who are trying to get some extra revenue.
The process of the reverse mortgage is rather simple. You reverse mortgage a property that is fully in your possession. According to its market value, you will receive monthly installments. The homeowner will get these revenues each and every month for as long as they live. However, once they die, the proprietorship passes into the hands of the financial institution.
Sometimes, calculating the associated costs and potential gains is a bit hard, especially if you don’t know much about the concept. Luckily, you can visit this site to access a great reverse mortgage calculator:
5. Fast sales
Lastly, I have to mention fast sales. This is the simplest concept, but it can sometimes be risky. Basically, you’re looking for market fluctuations to make a profit. If you think that the housing prices are about to increase in a specific market, you can buy one or two properties and wait for the prices to go up so you can sell the assets.