Short-Term Real Estate Investing

Are you ready to invest in real estate? If so, the question of whether to invest in short term or long term investment opportunities will arise. Which is the best fit for your portfolio or investment strategy?

Money often needs to be stored for relatively short periods of time. There are many reasons: preparing for an emergency, anticipating an upcoming expenditure, or waiting for other investment opportunities that may arise.
As a general rule, the short-term investments are those that put preserving capital ahead of growing it.

What is a Short Term Investment?

Short-term investments, also known as temporary investments, are investments made with the expectation of a limited timeline, generally a period less than three years.

Examples of short term investments are stocks and bonds, while long term investments generally include pension funds and superannuation.

What is the difference between short term and long term investments?

1.Different term

Short term investments are usually done for less than 12 months while long term investments are for more than 12 months.

2.Different Risk Category

A short term investment usually provides a higher rate of return with a higher risk, while a long term investment provides a lower, stable return however the risk involved is comparatively less.

3.Different Investment Strategy

With short term investments, there is a higher chance of making money and losing money in a shorter timeframe, and with long-term investments, your money is tied up for a longer period but the chances of making more money, may increase.

What terms and returns can you expect?

The term of the investment depends on the scope and timeline of the project for the given investment opportunity. In general, the longer the project, the higher the potential returns (however this will always depend on the exact project and investment)

9 Types of Short Term Investment Options

There are several types of short-term investment options and each can serve a different purpose in your investment portfolio.

Consider investing in a few different types of short-term investments in your overall portfolio, to meet your various financial goals.

Here are the nine best short-term investment opportunities:

　・Certificates of Deposit
　・Treasury Inflation-Protected Securities
　・Series I Savings Bonds
　・Short-Term Bond Funds
　・Individual Short-Term Bonds
　・Peer-to-Peer Lending
　・Exchange-Traded Funds
　・Brokerage Money Market Mutual Funds
　・Savings Accounts
　・Real Estate Crowdfunding and Crowdinvesting

Real Estate Crowdfunding Market in Australia

Real estate crowdfunding platform continues to be a dynamic and ever-evolving industry.
By 2025, the crowdfunding industry as a whole is anticipated to be valued at more than $300 billion, and online real estate marketplaces are primed to capitalise on that explosive growth.

In the Australian real estate crowdsourced market, APRA states that the total addressable Real Estate Market in Australia is $312 billion. The real estate crowdfunding industry could boost the volume of deals to phenomenal levels in 2025 as investors seek to tap high yield investments and developers turn to the crowd for capital alternatives.

Short Term Investment Strategy

A short-term real estate investment strategy is great for properties in areas with stable or projected increases in value.

Also, if you can devote substantial amounts of time to the real estate's development, and if you can afford to pay considerable capital gains at tax time, then short-term real estate investing might be for you.

Related articles

• Guide to Real Estate Crowdfunding for Investors
• 5 Reasons to Invest in a Retail Shopping Centre in Australia
• REITs vs. Crowdfunding: What's the Difference?

The information in this article is general in nature. Any advice it contains is general advice only and has been prepared without taking into account the objectives, financial situation or needs of any particular person.
The article content is not intended to be a substitute for professional advice and readers are urged to seek their own appropriate advice before making decisions.

Any reference to a particular investment is not a recommendation to buy, sell or hold the investment.

   Nov 28. 2018 CrowdfundUP