Real estate investing is the purchase, ownership, rental, or sale of land for the purpose of earning money. Areas of investment include residential, commercial, retail, self storage and industrial.
There are a few ways to make money when investing in real estate:
Interest from loans
Investors lend money to a real estate developer and earn money from interest. Debt investing provides a regular cash flow for an investor.
Owning real estate allows the investor to earn money from the sale of that equity. The asset appreciation, or increase in value of a property over time, represents the potential profit and associated tax benefits available to an investor when that property is sold.
Owners of a property can earn income by leasing that property. Rental income can provide a regular income stream.