Real estate investing can be a stable endeavor if you know what you’re doing. Your money is backed by a physical asset that can increase in value and real estate holdings can earn you additional income. Diversifying your holdings can help improve the outlook of your real estate portfolio.

Buy in Overlooked Markets

A good way to diversify your real estate holdings is to buy property in previously overlooked markets. These overlooked markets tend to have more inventory at lower prices than in hotter markets. Staying up to date on trends in the market can help predict the next hot place to buy. Many markets in smaller midwestern cities are predicted to grow over the next decade. Another good thing about these overlooked markets is that there is less competition, which allows you to get ahead early. 

 Diversify Your Real Estate Holdings: Invest in Apartments

You can improve your portfolio and diversify your real estate holdings by beginning to invest in apartments. Apartment complexes of all sizes are being built in cities across the country, and remain a popular housing choice for a variety of different household types and income levels. Many people prefer living in an apartment over a single-family property. Investing in apartments can help you withstand shifts in the market. In the event of an economic downturn, more people tend to move into apartments rather than single-family homes. You should also consider investing in both luxury apartments and smaller buildings and units. 

Invest for Different Periods of Time

Another way to diversify your real estate holdings is to change the amount of time you own different properties. Some properties you may decide to hold onto for an extended period of time, especially if the value is expected to go up. Market conditions may make it best to only hold on to certain kinds of properties for only a year or two. Other properties you may purchase to rehabilitate, rent, and ultimately refinance. In some instances, you may hold on to your best investments to pass on to future generations.

Reviewing your existing investments to understand how they are performing is a good way to begin to develop your diversification strategy. This can help you identify which diversification strategies will be best to improve your real estate holdings. Implementing new strategies can help make your portfolio stronger and more resilient in the event of market shifts.

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One of the premier sources for real estate investing networking and education is the SWFL REIA. In the real estate world, the SWFL REIA is different in that they do not do information product sales. Their meetings are focusing on the best ways of investing in real estate by collaborating with other property investors who are sharing their experiences.

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