One way to make money as an investor is to look into real estate. Commercial real estate investing offers the opportunity to diversify beyond stocks and bonds with the potential for high risk-adjusted returns.
Many people shy away from multifamily investing because they don’t want to be landlords. What you may not know is that there are many ways to invest in this sector, and you don’t have to become a landlord to do it.
Over a hundred crowdfunding companies have sprung up since 2012 and many failed in the first five years. Most were unable to build momentum and attract investors or sponsors to their platforms. Others had their reputations damaged by promoting sponsors and investment opportunities that were poorly vetted.
For many investors, cash flow is a big draw. In a world of low-interest rates, it’s hard to find risk-adjusted yield in the form of cash flow from operations. For most categories of real estate, but especially for multi-family, cash flow is a major attraction.
Seattle’s economic growth has resulted in an unprecedented demand for housing which cannot be met easily in this supply-constrained region. With high demand and limited supply comes investment opportunities in the region that are hard to match.
One of the biggest factors that you need to consider and understand when looking at investment portfolio diversification is risk. Risk takes many forms, but in short, it is essentially the likelihood of unexpected losses for any type of investment.
Alternative investments frequently surface as options for investors looking for ways to change their volatility exposure and potentially generate additional returns beyond holding stocks, bonds, and cash. For the right investor, alternative investments can be a compelling choice for building a diversified portfolio.
When considering residential real estate investments, there are two distinct options: single-family and multifamily.
Investing in multifamily properties offers a wide variety of advantages for sophisticated investors. Leverage, cash flow, appreciation, equity growth, and, often overlooked, tax savings are all financial features of a sound multifamily real estate investment.