Beginners Guide to Real Estate – Speculation vs. Investment

 

real-estate-speculation-investing

So you want to get into real estate? You’re not alone. The market is oversaturated but depending on your location, it can be very profitable. Luckily, here in the city of Nashville, Tennessee, all you see is growth, more or less. New hotels and homes popping up around every corner. The value of your home nearly doubling. Crazy things like that allow the average real estate agent to sell over 10 homes in a single day. Yes, that did happen.

So what should you learn first about real estate? Well , it varies to what kind of real estate you want to get into. Do you want to buy tons of land and watch the price soared through the roof in a few years or are you more keen on playing it safe and buying bellow the market value to renovate and immediately sell for profit? Whatever it be, you can divide the two mentalities into two categories. Speculation and Investment.

Speculation

Before getting into each, understand that real estate in itself is an investment, even if you are only looking for the home of your dreams. Speculation is fairly self-explanatory. You’ve done the research and have studied the market so well that you pretty much get the feel of how much a home is worth. Luckily the way the world operates is that not everyone lives a dandy life. Some go through hardships like divorce but there is one in particular that works in your favor. A thing call foreclosure. For whatever reason, if a homeowner can no longer make mortgage payments, the home will be seized by the bank and placed on the market. Due to high frequency that this occurs, you can often find a great deal on a home. If you recognized the home is being sold for less than its market value, you can seize the moment through and be rewarded for your speculation.

Investment

On the other side, and sometimes not so “other side” of things, you have the option to make a flat out investment. Sometimes this is paired with speculation but for the sake of the process, people take on investments to satisfy a vision. They examine a home and find that is could use some renovating. New floors. New wall paint. Granite counters and a new stove top. Often, it can be the small, outdated items that you replace which will make a less than appealing home worth more than you put in. Hense investment. On the downside, you also have to know a lot about home renovations before you consider investing in a home. You must be able to identify repair costs upon sight in order to get an idea on your potential ROI, also known as return on investment.

Think You Know More About Real Estate? Leave Comment with Your Thoughts and Recommendations! Have a question or post suggestion, send it to my Snapchat –> tracey5259 If This Post was Truly Helpful, Leave a Like to Let Us Know!:)

-Image from Pixabay
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2 comments

  1. Investing on real estate is a wise decision. Properties increase their values throughout years, and your money is in a good investment because of that. Just make sure that you study well about real estate and the things that you need to know about it.

    Liked by 1 person

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