5 Ways to Start Investing in Real Estate?

Investing in Real Estate

Investing in real estate can be a lucrative source of passive income. However, getting started in real estate investing may seem daunting to many due to the lack of experience, knowledge or information available.

Whether you consider property investment in the UK, or try your hand at REITs – one simple fact will remain the same:

Research and due-diligence are vital if you want to secure a successful investment asset. 

If you don’t have at least some idea of what you’re doing, then you’re likely stumble and miss out on the best opportunities.

So, without further ado, here are five ways to start your real estate investment journey:

Here are five ways to start your real estate investment journey:

1. Invest in REITs

One of the most common ways to invest in real estate is to invest in real estate investment trusts, or REITs. This is especially popular among retail investors, due to the low capital required and the passivity of this investment method. REITs allow investors to invest in real estate without owning and managing the physical property.

The REIT manager takes care of the properties in the REIT. Most REITs are publicly traded and can be bought and sold like stocks on an exchange. However, the risks vary across different REITs, depending on the investment portfolio and profitability of the individual REIT. Investors who are new to real estate investing can consider starting with publicly-traded REITs that can be purchased through a broker.

2. Invest through online real estate investment platforms

Online real estate investing platforms such as RealVantage have been gaining popularity among investors. These platforms provide investors with access to real estate projects that require either debt or equity financing. Investors would generally receive monthly or quarterly distributions from the investment projects, while paying a fee to the real estate investment platform.

However, these projects usually come with higher risks, are less liquid, and require a higher initial outlay. As such, online real estate investment platforms usually targett accredited investors, who generally have the capital required and are willing to take on higher risks.

3. Investing in rental properties

If you prefer a more hands-on approach to investing and managing properties, you may consider investing in rental properties. Investors who are interested in this method of investing may start with purchasing an investment property, such as a condominium unit, for renting out. You may choose to rent out rooms within the unit, or choose to rent out the entire unit. The downside of this investment method is that it usually requires investors to take care of the maintenance and repair works in the unit, or any complaints that the tenants might have. Alternatively, you may engage a property manager to take care of the maintenance or repair works for your unit. When adopting this investment method, it is important that the rent charged should be higher than all the combined expenses, in order to reap a profit from renting.

4. House flipping

Investors who house flip usually purchase underpriced houses that are in need of some renovation. They would then carry out renovation works that should be as inexpensive as possible, then resell these houses for a higher price for a profit. This is a more hands-on and time-consuming real estate investment method with higher risks. It may be worth noting that it will be hard to determine the exact price of the renovation through such investments. In addition, investors will need to invest much more capital into the property. Also, the longer the property is held, the lower the profit, since the mortgage would be borne by the investor without any income to cover it.

5. Rent out a room

For investors who already own a residential property and have rooms to spare, renting out a room in their property is also an option to consider. They can choose to target long-term or short-term tenants or specific tenant profiles, if they are willing to forgo some privacy and be comfortable with having another person living in their home.


Investors who prefer passive investments may be more inclined towards investing in REITs, while those who are more hands-on may prefer directly purchasing an investment property and renting it out.

The middle ground for investors who prefer to have ownership over the property, but favour passivity and are willing to take on higher levels of risk, would be to invest through online real estate investment platforms.

There is no one-size-fits-all way to invest in real estate. Whichever way you choose to invest in real estate should largely depend on your individual risk appetite, the amount of capital you possess and your investment time horizon, as well as the effort you are willing to put in.

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