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A beginner’s guide to real estate investment

Real estate agent and customer looking for apartment

I first started investing in real estate nearly two decades ago because I knew it was the smart thing to do. Statistics bear this out: Over the past half-century, real estate prices have risen considerably. People who put their money to work in real estate early on are now reaping the benefits.

Inflation continues to drive up the prices for real estate, which is a good thing for long-time investors like me. Properties I bought years ago are now seeing huge profits. The demand for rentals has also risen, as has the cost of renting — again to the benefit of investors.

As a new investor, you may think that only those with capital can afford to venture into real estate. Not so; even everyday people can earn a decent income from real estate investments.

While not everyone has the capacity to sink money into a multimillion-dollar high rise or a sprawling mansion, you can start small — by buying a starter home, perhaps — and grow your investment from there. The goal is to buy property, make enough to cover your risk, and generate additional income to buy more property; then rinse and repeat.

Sound simple? It often is, but investments are never without risk. For anyone interested in real estate investing, here are some options to consider.


You can either opt to invest in property the traditional way, which hinges on rising real estate prices or invest without actually owning a property. If you’re interested in the latter, you can explore exchange-traded funds.

You can dip your fingers into the real estate pie with real estate investment trusts (REITs), and dispense with owning physical property. REITs are similar to mutual funds; you get to invest in companies that own commercial properties and make money off of the dividends. Many first-time investors start with publicly-traded REITs, which they invest in through a broker. You may want to start off the same way.

Direct Ownership

This is one of the best ways to invest in real estate. Most of the property I’ve bought has appreciated in value over time. While values can fluctuate, home values generally appreciate at a rate of at least around 3-5%, much in line with inflation.

By improving the property itself, I was able to eventually sell off my investments at a higher value. I’ve also invested in rental properties that have helped increase my cash flow. Rentals will boost your monthly income and help you put money in the bank for other goals you aspire towards.

Buy and Flip

It takes a certain amount of skill and know-how to sniff out a viable fixer-upper, renovate it and find a buyer quickly. While understanding the market is crucial to minimizing the risks, flipping homes can definitely be quite lucrative.

Investing in real estate can help you achieve very nice returns over time. There are many other options such as investing in vacation rentals or even commercial real estate.

The important thing is that you take your time to learn about market conditions and factors that can affect your investment. The more you know your market, the better equipped you will be to make sound decisions to ensure your success.

Give me a call at 480.518.2222 or send me an email at melikian(at)mindspring(dotted)com to get started on your investment today.