Real estate investing in a great way to generate extra income. Many people are opting for niche property investments… investments you don’t see every day and don’t immediately expect to be high-income producers. However, niche markets offer less competition and sometimes higher profits.
Find a few of our favorite examples below.
Niche Property Investments: 3 Unconventional Choices in Minnesota
1. Land
Investing in land may not seem as exciting as other types of real estate, but it can be a lucrative investment for those who are willing to see its potential. Land can be developed, subdivided, or leased for various purposes, such as parking or recreational use. Unlike other types of properties, land requires minimal maintenance, and property taxes are generally lower.
However, before investing in land, it’s crucial to research the area thoroughly to ensure that the investment will be profitable. It’s essential to consider the location, future plans for the area, and any potential zoning changes that may affect the land’s use. Working with a real estate agent who specializes in land can be beneficial as they will have the expertise and knowledge of the local market to help you find the best deals and maximize your returns.
Ultimately, investing in land may not be as glamorous as other types of properties, but it can be a wise investment for those who are willing to do their research and see the potential in a piece of dirt.
2. Mobile Homes
Investing in mobile homes can be an attractive option for those looking to enter the real estate market. Compared to traditional single or multi-family homes, mobile homes offer a lower cost of entry and potentially higher returns. In addition, renovating and flipping mobile homes is often less expensive and less time-consuming than a regular home.
One of the advantages of investing in mobile homes is the lower competition in the market, which makes it easier to find good deals. Many mobile home owners are looking to relocate quickly, which can present opportunities to purchase homes at a discounted price. With the trend towards smaller, more efficient homes, there is a growing demand for mobile homes and other alternative housing options.
Another benefit of mobile home investing is the potential for high returns. Fixing up a mobile home can be relatively simple, and with the right improvements, it can be sold for a significant profit. In addition, flipping a mobile home often takes less time and work than a traditional single-family home, allowing investors to quickly turn a profit.
While investing in mobile homes may not be as glamorous as other types of real estate, it can offer big profits for those who do it right. It’s important to do your research and work with experienced professionals to ensure a successful investment.
3. REIT’s & Investment Clubs
Real estate investment trusts (REITs) offer a convenient way for investors to gain exposure to real estate without actually owning the physical property. REITs are investment vehicles that own, operate, and manage income-generating real estate properties. These properties can range from shopping malls, apartment buildings, office buildings, hotels, and even data centers. When you invest in a REIT, you are essentially buying shares in the trust, and your returns come from rental income, property appreciation, and capital gains.
One of the key benefits of investing in REITs is that they offer diversification, both in terms of property types and geographic locations. REITs can also provide steady income and capital appreciation potential, making them an attractive investment option for both income-seeking and growth-oriented investors. Additionally, REITs must distribute at least 90% of their taxable income to shareholders annually in the form of dividends, which can provide a reliable source of income for investors.
Investment clubs, on the other hand, are groups of individuals who pool their money to invest in real estate. Investment clubs typically have a smaller number of members than REITs, with each member contributing a set amount of money to the club’s investment pool. Investment club members work together to identify potential investment opportunities, conduct due diligence, and make investment decisions as a group. Profits from the investments are divided proportionally based on the amount of money each member has invested.
Investment clubs can offer several benefits, such as the opportunity to network and learn from other investors, access to a wider range of investment opportunities, and the ability to leverage the knowledge and experience of other members. However, it is important to carefully research and evaluate investment clubs before joining to ensure that they are reputable and operate in a transparent and ethical manner