If you are just beginning your journey in investing in White Plains rental real estate, you may have noted that there are a variety of options out there. Rental property investors, mainly, have a lot of choices in terms of property type, size, and function. If you’re not yet decided on which type of rental property is more sensible for you, start by recognizing the four main types of real estate and the purpose of each one. Following that, narrow down your options until you determine the specific kind of rental real estate that fits your needs and goals.
Residential
Most of these new real estate investors, when assessing a purchase, opt for a residential rental property. Needless to say, there may be a substantial reason for this: the residential real estate market is big! In 2020, it was valued at $33.6 trillion and is still clearly growing. By definition, residential real estate is purchased and occupied as a dwelling by owners or tenants.
Within this broad category of real estate, there are various different kinds of residential properties: townhomes, duplexes, multi-family buildings, single-family residences, and more. Thanks to lifestyle and renter demographic changes, single-family rental properties have been in high demand for years. This makes investing in single-family properties one of the most well-known options for new investors.
Commercial
This kind, on the other hand, commercial real estate is property used only as a workspace or to conduct a business or trade. As with residential properties, there are a lot of different types of commercial properties. Office space, retailers, restaurants, hotels and resorts, and even healthcare facilities all fall under the nature of the commercial real estate.
There are various advantages of investing in commercial real estate, as it can be quite a very money-making option for a lot of investors. Nonetheless, the initial cost of a commercial property is most likely to be much higher than a residential property, which can be a difficult hindrance for first-time investors to actually push through.
Industrial
Even while it’s technically part of the commercial real estate category, industrial real estate is an exceptionally unique nature of real estate often designated for use in very specific ways. Examples of industrial real estate usually include car manufacturers, storage and distribution centers, food processing centers, power plants, and research and development parks.
There are furthermore three different classes of industrial real estate – A, B, and C – so it’s necessary to do your research if you are looking into investing. Leases on industrial properties can be very financially rewarding and likely to be very long-term holdings. And, the same as commercial real estate, it can be really expensive to buy industrial property, mainly if such properties are in heavy demand.
Land
The fourth and final type of investment property you should learn about is a land investment. In most situations, raw or vacant land is purchased with the focus to develop it in various ways or to put it to use the natural resources on or under the land for profit.
For quite a lot of investors who own land, this would comprise extending leases that allow tenants to harvest minerals or water, oil or mining, timberland, orchards, or to use as farms, ranches, and recreational activities. Obtaining raw land, absolutely, is a much speculative investment that carries an equally high degree of risk. But definitely, in the proper circumstances, leasing land can be a financially rewarding business for a real estate investor.
With plenty of different options available out there, quite a lot of real estate investors will specialize, meaning they will first get the knack of one type or sub-category of real estate. This can be primarily great when you are just starting off in view of the fact that it takes time to learn everything you need to comprehend aptly about investing in each type of real estate.
If you are ready and raring to start investing in residential rental properties, we can surely help! Our local White Plains property management experts team up with investors like you to help out determine, prep, and lease quality residential rental homes. Contact us today to learn more.
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