Learn the basics of how to get started in real estate investing, including direct ownership, REITs, and fractional ownership, to start building wealth through real estate.
Real Estate Investing for Beginners
Investing in real estate may seem like a big leap if you are just starting to learn about it, and are under the impression it has to be a huge commitment. Many people grow up thinking there is only one way to invest in real estate: save tens of thousands of dollars to invest in a 30 year loan maybe once in your life. That thought is widespread, daunting to many, and completely untrue. It doesn’t have to be overwhelming or a long commitment to a mortgage that has interest on it. Realbricks is a fractional real estate investing platform that allows you to get started with $100, but we also like to educate our investors on other strategies as well. Real estate investing in general offers one of the most stable ways to grow wealth. In this guide, we’ll walk you through the basics of property investing and how you can get started with fractional real estate, but also introduce some other methods as well.
Why Invest in Property?
Real estate is a time-tested asset class that has proven to be resilient during economic ups and downs. Here are some key reasons why property investment might be a great choice
Stability: Unlike stocks, real estate tends to be less dependent on news events and politics, making it less vulnerable to rug pulls.
Passive Income: Rental properties can generate consistent income.
Tangible Asset: Unlike many other investments nowadays, real estate is something you can see and touch, providing a sense of security.
High Intrinsic Value: Real estate holds strong intrinsic value because it serves essential purposes—people always need a place to live or a space for business. This constant demand contributes to its lasting worth.
Hedge Against Inflation: By investing in real estate, you can diversify your portfolio and hedge against inflation.
Common Types of Property Investments
Investment Type
Entry Cost
Risk Level
Liquidity
Management Required
Direct Property Ownership
High
Moderate to High
Low
High
REITs (Real Estate Investment Trusts)
Low to Moderate
Moderate
High (stocks)
None
Fractional Real Estate (Realbricks)
Low (as little as $100)
Low
High (secondary market allows sell orders)
None
There are many ways to invest in real estate, from buying a house to investing in REITs (Real Estate Investment Trusts). However, fractional real estate investing is an excellent option due to its flexibility. It combines multiple strategies, like buying and holding, rental property investing, and allowing you to essentially create a personalized REIT by selecting individual properties that you choose.
With fractional investing, you can earn rental income paid as quarterly dividends, while also benefiting from property appreciation. Traditionally, these advantages were only available to homeowners or wealthy investors who could afford multiple properties outright.
A unique advantage of investing with Realbricks specifically, is that all properties on the Realbricks platform are fully paid for in cash, meaning there’s no mortgage involved. This makes interest rates irrelevant, unlike other platforms that finance properties through loans. When platforms rely on loans, investors' returns can be impacted by interest payments, reducing overall gains. Realbricks prioritizes quality over quantity, carefully vetting and fully paying for each property to offer better value to investors as the platform grows.
How to Get Started with Property Investment
Here are a few steps to guide your entry into real estate investing:
Set Clear Financial Goals What are you hoping to achieve? Are you seeking steady rental income, long-term appreciation, or both? Understanding your goals will help guide your investment decisions.
Assess Your Budget You don’t need to be a millionaire to invest in real estate. With platforms like Realbricks, you can start with as little as $100. This makes property investment more accessible for beginners.
Do Your Research Knowing the market is crucial. Research property values, rental yields, and market trends. Realbricks curates properties in stable markets like Omaha, allowing you to make more informed decisions with minimized risk.
Understanding Fractional Real Estate Investing
Low Entry Cost: With Realbricks, you can start with just $100.
No Mortgage Hassle: Unlike direct property ownership, fractional ownership doesn’t require you to take out a loan.
Passive Income: Estimated quarterly dividend payouts of 6% on all Realbricks properties.
Easy Exit Options: Realbricks offers an open marketplace where properties move after all shares are sold, allowing investors to sell shares back to buyers, in an open marketplace.
Risks and How to Mitigate Them
No investment is without risks, and property investment is no exception. Market fluctuations, changes in property value, and economic downturns can all affect your returns. However, fractional real estate can help mitigate some of these risks by:
Diversifying Your Investments: Instead of putting all your money into one property, fractional ownership allows you to invest in multiple properties across different markets.
Choosing Stable Markets: Realbricks focuses on economically stable markets like Omaha, which have lower volatility and eviction rates, making it a safer choice for beginners.
Defending Against Interest Rates: Realbricks acts as a shield to interest rates for our investors. Providing real estate exposure to properties that are fully paid off. Normally reserved for the wealthy, this is an advantage that now anyone can have with just $100 to get started.
Tips for Successful Property Investment
Start Small: You don’t need to invest everything at once. Realbricks' low minimum investment allows you to start small and scale up as you become more comfortable.
Educate Yourself: Stay informed about real estate trends and market conditions. Visit our learn center and subscribe to our newsletter for constant updates on everything real estate.
Think Long-Term: Property investment is generally a long-term game. Holding onto your shares allows you to benefit from both rental income and property appreciation.
What is Fractional Real Estate Investing?
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Fractional real estate investing allows multiple individuals to invest in a property by purchasing shares. This makes real estate accessible to more people by lowering the cost and providing the benefits of ownership without the full responsibilities of being a landlord.
What is the Minimum Investment on Realbricks?
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The minimum investment on Realbricks is $100, making it easy for beginners to start investing in real estate.
How does the Secondary Market Work?
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After a property sells all its shares in the primary marketplace, it moves to the secondary market after 30 days. This open marketplace allows investors to buy and sell shares at will, providing more liquidity and flexibility.
Why is Real Estate a Good Investment?
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Real estate is known for its stability and potential for passive income. A timeless investment strategy that holds intrinsic value in a tangible asset that can serve as a hedge against inflation. Realbricks makes real estate investment accessible and manageable by lowering the entry cost and allowing for fractional ownership.
Can I sell my Shares on Realbricks?
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Yes, once the property has moved to the secondary market, you can buy and sell shares at your convenience, offering greater liquidity compared to traditional real estate investments.
How to Get Started
Property investment doesn’t have to be complicated or reserved for those with deep pockets. With Realbricks, you can start building your real estate portfolio with just $100. Fractional investing makes real estate more accessible than ever, providing beginners with a solid foundation to grow their wealth. Sign up on Realbricks today and start your journey toward property investment.
Disclaimer: Investing in real estate involves risks, including the potential loss of capital. This content is for informational purposes only and is not intended as investment advice. Investors should perform their own research and consult with financial professionals before making investment decisions.