While it is certainly still a dominant strategy to purchase properties and rent them out, the real estate market in Tampa, FL is such that there are new ways to invest in real estate that you might not have considered in the past. For instance, there are now a variety of investment products called Real Estate Investment Trusts (REIT) that allow you to essentially buy “shares” in a real estate buying company, receiving dividends and seeing your investment grow in value even without running the real estate portfolio yourself. However, if you are interested in personally purchasing a home or homes in the Tampa area, here are three of the top ways to turn real estate into an investment strategy.
Purchase and live in a multi-family home
One strategy that can provide both housing and income is to purchase a multi-family home, be that a duplex or a small apartment building. Many people in Florida find that the weather is so pleasant that they can enjoy the outdoors and live in a smaller space, benefiting from having less square footage to maintain. It’s more affordable to pay the mortgage on such a property if you also have a renter or renters in each of the other units of the property.
At the same time, living on the premises of your rental property allows you to keep an eye on things and never have a long commute to answer tenant questions or make basic repairs. If you’ve thought about having renters in the past, this is an excellent way to dip your toes into real estate investment. As a plus, if your circumstances change or someone in your family needs to live with you, it’s possible to change directions and have more of the property to yourself as long as you abide by your lease with any renters.
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Purchase a home with separate entrance basement or tiny home
An even smaller investment can be to renovate or build on your existing property. By investing in your own residence, you can take advantage of the Tampa rental market for vacationers, renting a separate-entrance basement or tiny home on your property to vacationers for short-term rentals. Often this comes with a much less hefty price tag than other real estate investments, and can even be financed out of your existing home equity with a loan or line of credit.
Buy a standalone rental property
Finally, of course, you can purchase a separate rental property in Tampa. The market for rentals is strong here, so as you build equity in the home you’ll also ideally be generating some revenue profits that can be part of your overall strategy for income. Investing in real estate can be a strategy for diversifying income as you approach retirement or as a strategy for continuing to earn money during retirement itself. The nice thing about building a rental property portfolio is that, if you realize that the day to day maintenance is beyond what you’re interested in doing, there are property management companies that can handle much of that work for you for a fee.