Real estate investing often feels like the holy grail of the investment world. It’s a market that people know improves over time – smart property investments rarely result in losses and lead to strong financial stability.
The only issue with real estate investments is the barrier of entry. Anyone can buy stocks and shares; you only need a few dollars to get started. With real estate, you’re usually faced with a few barriers that prevent many of you from getting involved. We’ll discuss three of the biggest barriers in today’s post and provide you with some solutions to get on the property ladder!
Extensive Initial Costs
As mentioned above, you can invest in stocks with a few dollars to your name. You may not earn much, but it’s still possible to do. The same can’t always be said for real estate investments. They require huge upfront costs that many of the population can’t stomach. Do you have a few hundred thousand dollars lying around? Probably not!
What’s the solution? Well, home loans and mortgages can help many individuals afford properties. It slashes the upfront costs from a few hundred thousand to tens of thousands – or even just a few thousand, depending on the loan.
Alternatively, you could look into real estate investment funds. Property investment expert Aby Galsky explains that these funds pool capital from multiple investors. As such, you need to invest less money upfront yet still benefit from getting on the property ladder. You don’t technically “own” the property (or properties) but you do benefit from the investment gains.
A Lack Of Market Knowledge
In fairness, this is a barrier to most investment opportunities. People don’t understand the property market as extensively as they should, which can intimidate and put them off investing.
If you don’t know where to begin, how can you get started?
The solution to this is simple: work with real estate investment experts. Find a broker who’ll help you navigate this complex market and figure out the best investment strategies based on your income and how much money you’re willing to invest. It takes the confusion out of the situation, allowing you to invest with more knowledge.
Too Time-Consuming
Some people believe that property investments are too time-consuming. More specifically, they consume too much of your time as you have to manage the property. This is technically true for buy-to-let properties but not so much for long-term investments.
Ironically, that’s already one of the solutions to this barrier. If you don’t have the time to manage property rentals, then invest in long-term properties instead. Buy a house, live in it for years, then sell it for a profit.
Or, you could hire dedicated property managers to deal with your investments. This lets you get involved with rental properties without spending all of your days looking after each asset.
Different barriers will block different people. Which one is stopping you from getting on the property ladder? There’s always a way around a barrier, meaning anyone can enjoy the benefits of real estate investments.