Three Common Types Of Real Estate Investments And Advantages Of Each

Posted on: 10 January 2017

If you have been thinking about trying to find a way to earn some extra money, investing in real estate might be the perfect solution. If you have no idea where to start, here are three common types of real estate investments and advantages of each. 

Apartment Buildings 

In an apartment building, a renter basically pays you to live in the building that you own. Apartment buildings are a type of residential real estate property that can have anywhere from four or five units to hundreds of units. Apartments come in a variety of sizes and types and have anywhere from one to five bedrooms. While many single people find apartments convenient, there are also many families that choose to live in an apartment. When it comes to real estate investments, some of the advantages apartment buildings offer include the following: 

  • You can hire someone to manage the property 
  • Having all the rental units in one place provides convenience and efficiency
  • Having multiple tenants makes it easier for you to pay down your mortgage

When it comes to residential real estate, investing in apartment buildings is a great place to start. 

Office Buildings 

Considered a commercial type of real estate, office buildings provide a way to earn rental income from business owners and companies. Like apartment buildings, office buildings can range in size and have various numbers of units. The advantages to renting an office building are comparable to that of apartment buildings in that you can hire someone to manage the property. Other advantages investing in office buildings provide include the following: 

  • Often have multi-year leases making cash flow more stable
  • Investors can deduct mortgage interest and depreciation deductions
  • Tenants generally pay for all of the expenses

If you're wanting to get involved in commercial real estate investments, office buildings might be the way to go.

Retail Real Estate

If you think office buildings are too limiting for the type of commercial real estate investment you want to make, you may want to consider retail real estate. This type of real estate can include shopping malls, retail storefronts, and department stores. Some specific advantages investing in retail real estate include the following: 

  • Landlords may be able to receive percentage of sales
  • Retail tenants have an incentive to work with the landowner to improve property
  • Flexible lease terms when compared to residential real estate 

Since the advantages are so similar, some commercial real estate investors try their hand at both office buildings and retail. For more information, contact a business such as The Clement Group at RE/MAX Properties, Inc.


Saving Money On Real Estate

After I got promoted at work, I realized that there were a few things I wanted to do with all of the extra money. One of the biggest goals that I had was investing in local real estate, because I wanted to experience what it would be like to own multiple properties. It was really overwhelming at first to put in the offers, but after awhile I got really good at saving money on real estate and seeing the rewards. This blog is all about knowing which properties to invest in and focusing more carefully on the art of getting a great deal.