Making Money on Residential Real Estate: Types of Investment Properties

So, you’ve decided that you want to invest in residential real estate. First, I want to congratulate you because you’ve made a very wise decision. You’re on your way to big things and I have some GREAT news for you! This is the plain and simple truth, there are many, many, MANY ways to make money in residential real estate. Did I mention, that there are MANY ways to get that cash flowing? This means that you have countless options to choose and pick from!

There are numerous different property types that you can use to make money in residential real estate with. However, the secret is finding which property type works best for you. You want to find the one that you can throw your heart and soul into. Now I’m going to hit on some of your options! Here we go, this is the exciting stuff, get ready!

1. Single-Family Homes: this happens to be the most common investment for first time and beginner investors. The properties are easy to rent, sell, and easy to finance. A lot of investors chose to invest in these properties and then rent them out so they have a steady and continuous cash flow coming in from the property.
2. Duplex/Triplex/Quads: these properties are small multifamily properties, which contain 2-4 units. These properties are also easy to rent, sell, and it’s easy to get finance. Some investors pick these over single-family homes because there is less competition found in larger investments. One major pro of these properties is that it can serve as an investment for cash flow as well as a personal residence for the smart investor.
3. Apartments: these properties can be a little bit more difficult to finance, but the opportunities are endless! Think about it, the value of these properties is based on the income they bring in. Therefore, it’s extremely easy to add value by increasing rent, decreasing expenses, and having effective management.
4. Office spaces: in this case, we would buy a commercial building and rent out office spaces to business professionals.
5. Mobile Homes: these are typically found in parks, but can be found elsewhere. These provide and inexpensive way to enter the world of residential real estate investing. Mobile homes can bring in significant cash flow.
6. Raw Land: purchasing land does not typically produce cash flow, but can be improved to add value. You can also subdivide the land and sell it for profit. A farm investing goes along with this. In addition to the land itself, the products made on the land can be used to make a profit.