What are the Best Types of Properties for Real Estate Investors?

The first step as a real estate investor is usually the most difficult. New investors may feel overwhelmed by everything they don’t know about real estate: the terminology, the market, the capital, the risks, and the rewards. The variety of investment properties available makes real estate a popular investing strategy among investors. Whether you are a beginner or a professional, real estate investing provides something for every investor. In this article, we will examine the best types of properties for first-time real estate investors.

1. Single-Family Homes

For beginner real estate investors with little experience, investing in single-family homes is one of the most common real estate strategies. Single-family homes generally hold a resale value regardless of the property’s age. Before being placed on the market, renovated homes can have a higher sale price than those that need repair work at the time of purchase. Investing in single-family homes is the easiest way for beginners to enter real estate investing. The high demand for single-family rentals makes it a reliable income property in any real estate market.

2. Multi-Family Homes

Multi-family homes are residential properties that include at least two separate housing units. The high positive cash flow they can generate makes them attractive for investment. The fair market value of multi-family homes will almost always be significantly higher than that of single-family homes in the same area. Still, when it comes to investment properties, it’s also easier to secure financing for multi-family properties. Investing in multi-family real estate may be a much faster way to grow than single-family rentals if investors want to expand their investment portfolio. It also offers the opportunity to move toward commercial real estate investing as larger multi-family properties start to fall under commercial real estate, with even greater cash flow opportunities.

3. Commercial Real Estate Properties

These are usually brick-and-mortar businesses, office buildings, or skyscrapers. Real estate investors can lease multiple units as offices, rent to one company, or much more. It is common to see multi-year leases, which protect during an unstable economy if rental rates decline in the commercial sector, just like we saw at the height of the pandemic in some regions of the country.

Bottom Line

Beginner investors should start by getting clarity on what they have and be ready to take bold action to get started. Real estate properties may give investors the lowest risk, the most options, and flexibility. Once they get a few successful investments, they may expand to take on more adventurous projects.

Investor Loan Source, a private money lending company, provides high-quality investment property loans to private real estate investors at the lowest costs possible. Our process for providing real estate investors with private lending is unique. We place emphasis on the hard asset and value of the collateral (property) and less on the borrower. Our asset-based real estate investment loan model means we can provide more money lending to more investors than is available from standard bank loan models. At Investor Loan Source, providing real estate investors with hard money loans is our business; it’s all we do. We offer several business real estate loan products designed to serve a variety of investors and property profiles, including private money lending for properties to sell on owner finance. 

To learn more about Investor Loan Source, visit our website or follow us on LinkedInFacebook, and Twitter. To apply for a loan, click HERE.