If you’re a military member, there is a greater need for you to start investing in real estate right now. Instead of saving it in the bank, you can use your benefits to build a real estate investment portfolio.
What’s even better about this type of investment is it can help you create a passive income even without being a full-time landlord. This is especially beneficial for military members who have deployments in various places. That being said, here are some ways to start investing in real estate:
1. Flipping Houses
House flipping is when you increase the value of a property from its original or under market value. Here, you’ll be buying properties in need of renovation or major repairs. Then, conduct necessary repairs, so you can sell it at a higher price.
But, this type of real estate investment may need a significant amount of money. As a military member, you can use the VA loan. However, you cannot use this loan to buy unsanitary, unsound, and unsafe properties.
Instead of buying dilapidated properties—the most common strategy in house flipping—you should buy one that can pass the VA’s appraisal requirement. This refers to the property being safe, sound, and sanitary, which means it should be habitable and doesn’t need significant improvements. And you should live in it for a minimum of one year as per the VA’s occupancy requirement.
With such, you may want to consider a habitable home, but one that you can still add value to. You may have to buy a house that’s under its market value due to its aesthetic or outdated fixtures. For instance, a simple property can yield a higher value if you update its basement, expand its deck, or modernize its kitchen.
Then, live in it for at least a year. And while doing so, you can do the mentioned value-adding improvements. That way, you can sell it for a higher price which should compensate for the improvements and original purchase price.
What’s even better is you can reinstate your VA loan after making a profit on your first house flipping venture. All you need is to check and work with the Department of Veterans Affairs for some paperwork.
2. Renting Out Spaces
The VA doesn’t allow buying single-family homes, primarily when military members use them for investment properties. Thus, use it to purchase multi-family properties.
These properties have multiple living spaces. Instead of letting it sit empty, you can rent out some parts of the property.
For instance, you can buy a property with three separate units. You can live in one of them while renting out the others.
3. Investing In Real Estate-Based Products
You can still invest in real estate if you don’t want to use the VA. All you need is to find a reputable platform offering real estate-based products, such as large-scale residential and commercial real estate ventures.
What’s even great about this way is you can start with $500. Then, you can choose from various real estate projects to invest in. Although they might not give you an immediate return of investment (ROI), you can earn from their appreciation and dividends over the long run. And you don’t have to maintain the physical property or find tenants for this real estate investment.
As long as you conduct in-depth research on the projects to invest in, then this will be a good start. And this is even better for military members who are always on the move.
Start Investing In Real Estate
Nowadays, saving your money in banks isn’t the best way to grow your earnings as an active military personnel. But investing in real estate can be a good way. There are many more ways to build a real estate investment portfolio, but the most common are the top three mentioned above. It may take some time to see the return, but it’ll be worth it.
