Real estate is often seen as building financial freedom by creating a consistent income stream. Today, major investments in Staten Island are driving the local economy, with over $2 billion committed to various projects that make it an appealing option for real estate investors.
However, knowing what type of properties you want to invest in can be complicated. To choose the one that best fits your overall investment strategy, it is essential to know what types of property investments are available. Let's dive into what those property investments are and how your Staten Island realtor can help.
Types of Property Investments
Most property investments fall into two categories, physical real estate investments that you own and REITs and crowdfunding platforms. Traditional real estate investment can provide high returns but requires significant capital upfront and ongoing overhead costs. There are five types of real estate investing available, including the following:
REITs – Real estate investment trusts allow you to invest in companies that own commercial real estate but do not carry the same level of risk associated with owning real estate directly. These are required by law to return 90% of their taxable income to their shareholders.
Crowdfunding platforms – These platforms offer the option to access real estate investments with high returns, but the risk level is greater. Some crowdfunding platforms are only available to accredited investors, often based on net worth. However, other platforms are available for nonaccredited investors. They are not necessarily traded upon the stock exchange, so they don't have the same rules. Your funds are also likely to be invested for several years, and the track record of these platforms is relatively short, so there is little indication of whether they can survive an economic downturn.
Residential real estate – This type of investment is the most common, as Staten Island realtors can attest. Most investors seeking this route look for properties they can rent to families or individuals. Some choose short- or long-term rentals, but they can also opt to flip homes and sell them after making changes that increase their value.
Commercial real estate – This real estate includes hotels, offices, retail space, warehouses, and even storage units. These properties can be purchased and then leased out to various businesses, creating an income stream, but you also need significant capital and property management expertise.
Raw land – This is land you own, which can be developed for residential or commercial use. This type of investment works best for someone with a large amount of capital and significant real estate experience.
Which Investment Is Best?
Investing in real estate requires you to do your due diligence, including knowing your local real estate market. With a realtor in Staten Island, you can get the benefit of someone who knows the local market and can assist you in finding real estate that meets your investment criteria. Contact our team at Wonica Realtors & Appraisers to learn more about the real estate available locally.
Wonica Realtors & Appraisers are Staten Island's #1 independent full-service real estate firm, serving the needs of the community for over 30 years. Whether you are buying, selling, renting, or relocating, our staff of highly trained professionals will provide quality realty services with personal attention to your individual real estate needs.