Real Estate Investing
Alternatives to Traditional Property Investments
by Chris Parry (Write for us!)
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Traditionally, a property investment is considered to be a home, apartment or duplex one
might buy to rent out and
generate a profit. However, there are actually alternatives to traditional property investments. You can buy undeveloped
land or overseas property and turn a profit just as easily as you can with a rental. It is not necessarily that simple,
but the alternatives to traditional property investments warrant a look if you are considering a property investment
to build your portfolio.
The first option is to invest in land. Though many do not think of land as a high yield investment, the truth is
that it can net you just as much money as a rental property if you buy wisely. The first benefit of land is that it
is always in demand since land cannot be made. There is a finite acreage of land in the world, and when you own some
of it, you are an owner of a finite commodity.
The other benefit to land is the cost of the initial investment. If you choose to buy land, your initial investment
will not be as much as it might be with developed real
estate. For a fraction of what a property with a rental house or
apartments on it might cost, you can have a large piece of land. If you buy wisely, then, it is a matter of time until
the area surrounding your land gets developed. When you do sell your land for development, you will likely net a much
larger profit than with several years of a rent-producing property where you may only have made a few dollars over your
mortgage each month.
Another non-traditional investment is overseas property. Not unlike buying property domestically, you want to make sure
you buy property on the rise overseas. However, there are other advantages as well. You can often benefit by avoiding
some taxes since you will not live in the country where you invest. Additionally, there can be domestic tax breaks because
of where your income will come from. Obviously, the biggest drawback to such an investment is that you either have to
travel overseas to scout out property or you will have to go in with a partner who has intimate knowledge of the property.
Either way, you are going to incur an expense during the transaction. However, if you can make it happen, an overseas
property investment can be lucrative and a great
way to receive tax breaks.
These are just two of the many alternatives that are out there to traditional property investments. Though with any
investment there is risk, sometimes going against the norm can get you real rewards. Whenever you make any traditional
or non-traditional property investment, you want to make sure you have all the information and that you invest wisely.
However, before you consider the traditional, you should extend yourself and consider a purchase of undeveloped land or
overseas property. You may be surprised at what they can offer you.
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