Everybody wants to own a real-estate, be an investor, but not everybody can afford property.
With high prices and very little capital, there are more and more people looking towards the unconventional and creative property investing methods than ever before.
Below are some of the ideas that have changed the way an average American ever thought about real estate investing.
Option This is a great and creative way of real estate investing.
As the name suggests, here we are talking about an option, an option to purchase the house at a later date by reaching an agreement with the seller.
What this means is that the investor and the seller will set a price for the property and agree that the investor will be able to purchase that real estate for the agreed value in the future.
During this time, the buyer will pays a premium to the seller for not selling the property to someone else.
This option can be sold by the buyer to a third party on his discretion.
Seller Financing This creative real estate investing method is very helpful for those prospective investors who do not qualify for a house loan.
Here the seller becomes the lender and agrees to receive the amount for the property in installments, at a premium of course.
The seller and the buyer decide the repayment schedule and the amount of interest between themselves.
A potential risk of seller financing is that the seller might miss out on the payment if the buyer defaults, while the disadvantage for the investor is that he would be paying more than the actual price of the property.
Bulk Buying Here the investor has money and is looking to make a profit through real estate by investing in bulk properties.
Here, the investor buys large number of properties, enabling him to negotiate lower prices.
Once bought, the investor now has the option to either sell the properties in bulk at a rate of profit or sell them to individual customers in small sizes.
The latter option will of course reap higher profits.
Leasing With leasing, the buyer uses the property, that is, he starts living in the house without having owned it already.
It is a combination of option and rental agreement.
Here the premium is much higher than in option but at the same time, the buyer is actually living in the house, although he does not own it.
To put it simply, in leasing, the buyer rents the property for a specified time at the end of which he has the option of purchasing the property for an agreed price.
Hard money lenders Going to hard money lenders is a very creative real estate investment option for those with a bad credit rating but with a good business plan.
If you fall into this category than hard money lenders are your best bet as they would lend money to anybody with a good business plan.