If buying a property is too expensive of an investment for you

 

If buying a property is too expensive of an investment for you

1. Invest in Real Estate Investment Trusts (REITs)

A REIT, or real estate investment trust, is a company that either owns or finances real estate that produces income. REITs invest the majority of their money into real estate, and it's how they make the majority of their income.

There are REITs that focus on both residential and commercial property. Most REITs are equity REITs, but some trade in mortgages instead of actual properties. Perhaps most important for you, the investor, is that at least 90% of the taxable income it pays is via dividends to the shareholders. So researching thriving REITs and purchasing shares in them has potential as a profitable investment.

2. Invest in Real Estate Mutual Funds

Real estate mutual funds differ somewhat from REITs. Whereas a REIT is an actual company, mutual funds are simply investments pooled together and overseen by an investment manager.

A mutual fund allows investors to have diversified their portfolio both in terms of having a mutual fund and having real estate. Like with other sorts of mutual funds, you can choose ones that are growth-oriented or income-oriented. As a diversified asset, they are designed with the intention of mitigating risk, but they are still vulnerable to the risks inherent in real estate. If a real estate-related risk negatively affects one of the investments in the fund, it's likely to impact a lot of others too.

3. Invest in Real Estate ETFs

In addition to REITs, there are REIT ETFs, or exchange-traded funds. REITs invest in real estate; REIT ETFs invest in REITs. It could be less risky than investing directly in a REIT, and certainly less risky than actually buying property, but you'll also be getting less of a return back. Still, if risk is one of your biggest concerns when mulling a real estate investment, a REIT ETF is something that should be considered.

4. Use an Online Real Estate Investment Platform (used for Real Estate Crowd Funding)

Much like with other sorts of stocks, there are online platforms that help you make real estate investments as well. Often, these investments you make are part of crowd funding, a way for others to be able to buy property without requiring venture capital. This option tends to be more for those with money to spare, considering the costs necessary to purchase large property.

5. Real Estate Partnerships

Some real estate investments require an exorbitant amount of money. Not everyone can foot that. If you're not the only one involved in the investment, however, it could become more manageable.

Partnerships are a common way to invest in real estate, with each person taking over different responsibilities. Often, this can be used as a way to purchase property at a lower price. You can set the terms. Depending on the terms of your partnership, you may be investing in real estate without doing too much hands-on work of owning property.

6. Invest in Construction Companies

Another real estate-related investment that could be worth your time are companies that are involved in the construction of properties.

There are plenty of building companies whose stock trades every day. It's an intriguing investment option for those who believe that the construction of properties  is something that will continue to increase, because if that's true, business should continue to boom.