A Beginner's Guide to Investing in Boston Area Real Estate

Updated August 31, 2022

It's no secret that investing in real estate can be a lucrative endeavor, and it's not hard to see why investment properties have long been considered one of the safest investments on the market. However, with so many different investing strategies, it's hard to know what it takes to invest in real estate successfully as a beginner. So who should you trust for advice?

This article will discuss some of the benefits and "how-tos" of investing in real estate. We'll also tackle different ways to invest in real estate, including owning a rental property and the importance of hiring the best property management Boston offers. In the end, you should understand a bit more about the basics of real estate investing and the steps to follow to start your real estate investment business.

What is the Real Estate Industry?

Real estate is any piece of investment property or the land connected to it. The natural or manufactured elements that are a part of the land, such as trees, houses or other buildings, and fences, are also considered real estate.

Investing in real estate is purchasing a piece of property and any improvements on the land, such as structures or dwellings, to generate revenue through renting or reselling the property. Investment properties are divided into several categories, including residential, commercial, and industrial.

Don't Real Estate Investors Need a Lot of Money?

To those unfamiliar with the business, real estate investing for beginners may be intimidating. Since many millionaires make money through real estate, it may seem like it takes a lot of money for success—but that's not necessarily true! Many investors start slow with one rental property and some savings or a mortgage to finance their first real estate investment.

Real estate investors who start small can find great success through learning about their local market, building a network, and raising money through different funding methods. Then, as new investors build experience and the right partnerships, they build their portfolios and revenue to meet long-term goals.

What Are the Different Ways to Invest in the Real Estate Market?

While rental properties are one of the simplest ways to get started and build wealth, there are a variety of ways to invest in real estate. If managing a rental property isn't your idea of generating passive real estate income, here is a list of some of the ways to invest in real estate for beginners.

Real Estate Investment Trusts (REITS)

REITs generate money through the leasing, renting, or sale of real estate owned by the trust. There are several types of REITs specializing in specific assets, such as residential properties, mortgages, healthcare facilities, or infrastructure. When choosing to invest in a REIT, investors buy "shares" or "stocks" in the trust that owns and operates properties. The trust then pays out dividends to investors over time. 

Real Estate Stocks

This form of investing in real estate isn't as well-known as the others on our list, but it's a fantastic approach to capitalize on the real estate market without having to purchase a property yourself. Real estate stocks can include homebuilders, real estate agencies, government-sponsored mortgage purchasers, home improvement vendors, and other companies that specialize in real estate.

Rental Properties

When you think of the real estate industry, the first thing that springs to mind is most likely a rental home or residential real estate. Purchasing a house, condo, or multifamily property to rent out to tenants is one of the most straightforward forms of real estate investing. Rental houses are an excellent long-term investment to generate monthly rental income. Then, when you're ready to sell a property, you also benefit from the home's appreciated value. 

While this seems like an easy way to turn a profit, many first-time landlords make costly mistakes that eat away at revenue. If you decide you have what it takes to be a residential real estate investor—but you like the idea of operating rental properties—a property management company can guide you through the process and handle the hands-on tasks for you!

House Flipping

House flipping has grown in popularity based on the shows you've probably seen on HGTV. Fix-and-flip real estate investment opportunities include buying a cost-effective property in need of a facelift (sometimes an extensive facelift), then selling the property for a profit. While flipping can be quite lucrative, it can also break the bank quickly if you don't have the right experience and guidance. 

Commercial Real Estate

While not all commercial real estate investors become a billionaire, the commercial real estate market is one of the areas where big money can be made with the right strategies, funding, and partnerships. A commercial real estate (CRE) investment is a building, shopping center, hotel, or warehouse that isn't used for residential purposes. Succeeding in this sector takes a lot of time, experience, and capital.

Choose a Property Manager for Success in Residential Real Estate Investing

No matter how you choose to become a real estate investor, the right partners and strategies are critical for success! When investing in the Boston real estate market, choose the right property managers to guide your success as a property owner. 

CHARLESGATE Property Management has the experience rental property owners need to find excellent properties, manage renters, and maximize revenue! Reach out to discuss how our property management services can help you build a successful real estate investing career.