Real estate for small business owners is often the last thing we’re thinking about. With so many things to do, why add another huge burden? Well the answer is simple.

IT CAN MAKE YOU MONEY!

So, with that said. Let’s begin

Twelve Ways to Make Money in Real Estate

1. Buy a property and then sell it within a year for more than your original cost. This situation relies on wider and more volatile market fluctuations – like bull markets, higher regional demand and buying the right property in the right location at the right time. Although you will face higher short-term capital gains taxes.
2. Buy a property, fix it up and sell it. This is easier said than done due to the amount of moving parts. Especially when remodeling fees and time frames are almost always higher than expected.  Time is also not your friend here, so the faster the better. Of course shorter than a year and you face higher capital gains tax as well.
3. Buy your personal residence. Live in it  for two years and sell at higher cost with no capital gains taxes. The cut off is usually a tax-free gain of 250K for individual and 500k for married couples. Depending on the tax codes of where you live. There seems to be no limit to how many times this could be done. But it’s not without its hassles, since moving every 2 years would be tough, but doable.
4. Rent the property on long-term or short-term leases.  The goal here is positive cash flow through maintaining a higher rental income than you pay in holding/upkeep expenses.
5. Hold long-term and hope property value goes up in appreciation. This probably holds the greatest possible gain, since you have more options to sell during favorable market conditions.
6. Use part your property for your business, and rent out other portions to cover costs. This is another great use for small business owners, because you’re in control of your location costs. Not your landlord.
7. Offer lease-to-own terms to current occupants. This usually entails a larger down payment up front, that you keep if they decide to bail out. It also allows you to use the down payment to purchase further investments (like more properties). Also it sets a sales figure that you’ve negotiated in advance.
8. Use built-up equity for purchasing more properties. This can be tricky, since there are often high fees for receiving cash from refinancing a mortgage. Also using the equity of a property to buy another property, just puts you in more debt. Which can backfire if the market tanks or you can’t keep up mortgage payments.
9. Refinance mortgage payments for better terms to increase cash flow. This only works in a lower interest rate environment, and as of 2018 interest is more likely to go up. So your refinance days may be short.
10. Hold the property to build credit to help with business expansion. This is probably one of the strongest options for a small business. Since your real estate holdings are probably your largest assets. They can be very useful to help you raise the capital you need to expand your business.
11. Buy vacant land and build your own. This is a much slower process, but the buildings can be designed to meet your specific needs, using the style and material of your choosing.
12. Buy large parcels of land to develop. This is the slowest and most costly method. However, done properly, it can attain great rewards. However, it’s not recommended to do this on your own, since you’ll most likely need a good team to pull it off.

To make money in real estate is a time-honoured endeavor. Why leave it up to the corporate big wigs and real estate tycoons? As a small business owner, we’re used to taking risk. So why not try your hand at real estate. You can thank me later.