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What is a Denver real estate investor?
A Denver real estate investor is someone who purchases real estate with the intent of making a profit through rental income or reselling the property at a higher price. This can include buying and renting out single-family homes, purchasing and managing multi-unit properties, or flipping houses. Most real estate investors love to actually fix up a house to sell to a new family for the sake of keeping their communities healthy and in good shape.
How do they fund their deals?
Denver real estate investors typically fund deals using a combination of their own money and outside financing. Some common ways that investors may get funding include:
- Personal savings or loans from family and friends: Many investors will use their own money or seek loans from family and friends to fund deals.
- Mortgages: Of course mortgages are probably the most common sense thing because everyone knows and has access these these from their current bank.
- Hard money loans: Hard money loans are short-term, high-interest loans that are secured by the property being purchased. They call it “hard” money because it’s hard to borrow unless the deal is actually good enough for the risk in case the buyer defaults.
- Private money: Some investors may also seek funding from private individuals who are willing to lend in real estate.
- Crowdfunding: Some investors may also use crowdfunding platforms to raise money from a large number of people. This is usually with big multifamily deals someone like Grant Cardone would talk about or commercial investments.
What types of properties do investors in Denver buy?
Denver real estate investors typically buy a variety of properties, including:
- Single-family homes: Investors may purchase single-family homes to rent out to tenants, or to renovate and resell at a higher price.
- Multi-unit properties: Investors may purchase multi-unit properties, such as apartment buildings or duplexes, to generate rental income.
- Commercial properties: Investors may purchase commercial properties, such as office buildings or retail spaces, to generate rental income or to resell at a higher price.
- Vacant land: Some investors may also purchase vacant land with the intent to hold onto it for long-term appreciation or to develop it for future use.
- Fixer-uppers: Many investors in Denver also look for properties that are in need of repair or renovation, known as fixer-uppers, in order to buy them at a lower price, fix them up and resell them at a higher price.
The type of property that an investor chooses to purchase will depend on their investment goals, risk tolerance, and the current market conditions. Don’t be one of those fly by night looking to get rich type of people in real estate. You will fail hard and you don’t belong in real estate if that’s your goal.
Difference between a real estate investor and a real estate agent?
A real estate investor is acting on their own behalf with the risk of buying a house. If the deal goes south they are completely responsible for the losses. The biggest difference is intent and role in the transaction. They are the ones making the profit in cash flow or capital gains because of having the resources to pull the deal off.
A real estate agent, on the other hand, is a licensed professional who helps clients buy, sell, and rent properties. Their main job is to represent clients on a deal and the exit strategy is not important. There’s no risk to the agent as to what happens after the transaction compared to the investor’s role. They must keep up with regulations and laws differently too since they mainly handle paperwork for the transactions.
While a real estate agent can also be an investor, the main difference is that an agent’s main job is to facilitate transactions while an investor’s main goal is to profit from buying and selling or renting property. Real estate agents have a more client-facing role, and the main role of investors is to identify and purchase properties that will generate income or appreciation.