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Although property investment can return big rewards, it also usually comes with huge financial risks. What if your properties won’t sell when you need them to? What if no-one is interested in renting your commercial building? There are never any certainties when it comes to property investment, but there are a few ways you don’t have to take such a big risk with each property you invest in. Here are some:
Peer-to-peer platforms work in two different ways. You can either borrow money from investors or you can invest money that’s borrowed from other property developers. Some platforms will take a small amount of money, so it’s not as if you have to invest thousands if you’re thinking about taking a small risk. If you’ve never used a P2P platform before, the best advice is to join a platform and watch how it works first. You’ll quickly see whether it’s worth your while and you can reasonably calculate how much of a risk you want to take.
Crowdfunding is similar to P2P in that you don’t really have to get your hands dirty. You can take a small gamble by investing a small amount of money and see where it takes you. Unlike P2P any return that you see on your investment will be from the sale, rental income or financial growth of the properties. It’s a gamble because, depending on the market, a return isn’t always guaranteed and if you do get a return, you could be waiting a long time for it. So, if you’re getting into property investment to see quick financial gain, this may not be the way to go.
The great thing about property funds is that you can invest your money in more than one place. When it comes to property investment, many people put everything into one property, but with property funds you can spread your investments out. Therefore, you’re taking a small risk with multiple properties and you’re far more likely to gain from it, even if some of the properties don’t do as well as you’d expect. Investing in property funds gives you far more control than traditional property investment and it’s a great way to get started if property investment is all new to you.
You don’t have to be a landlord to make the most of property investment. If you’re lucky enough to live in a large property with plenty of space, you may want to consider taking on lodgers. It’s an excellent option for those who have large properties but very little income. Those who take on lodgers often find a knack for it and go on to run B&B businesses successfully, generating even more income from their property. Once you realise that a lodger is not a roommate but a way of making a living, it’s easier to keep a professional distance. This sets up an ideal foundation for taking a business further in the future.
Property investment is far from easy, but it is getting easier. So, when you’re looking to invest, or you need help to invest, don’t feel like you only have one option.
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