Real Estate IRAs:Understanding Your Investment Options

If you like the idea of having retirement income through your investments with Real Estate IRAs, then you’re not alone.

Many people are turning to these retirement accounts to build wealth, secure a nest egg, and continue to live comfortably even after they’ve stopped working. But anyone who’s ever looked into these investments knows that there’s not just one option when it comes to real estate: there are, in fact, many different types of real estate in which you might consider building your wealth.

“Real estate,” after all, is an umbrella term that encompasses all manners of land, buildings, and structures. If you’re going to get the most out of your real estate investments, it will help if you know your ideal investment type and work from there. In a Self-Directed IRA, it’s important to pick investments that you know better than others; real estate is no different. Let’s take a look at the different real estate investment options:

Investment Opportunities in Real Estate IRAs

First, sift through the list below and see if any real estate investment types seem more intuitive to you:

  • Raw land: The “purest” form of real estate? Land itself. On raw land, nothing has been built yet; it’s simply land that’s waiting for some sort of project…or maybe even land that you plan on holding as an investment. If you know property values in your area, you might know some areas in which you might expect the value of raw land to increase.
  • Single family homes: One of the most common forms of real estate—one house for one family. Although it’s tempting to want to use Real Estate IRAs to build wealth while living in your investment, this is actually prohibited by the regulations. If you want to invest in a single family home, it’s going to have to be someone else’s
  • Townhouses are a popular way to enjoy an independent lifestyle in the big city, and they can be highly valuable investments with which to build wealth and a consistent income—although they often require lots of leverage to acquire.
  • Condominiums are popular amongst young adults who want to invest in real estate but don’t have the kind of leverage to acquire more expensive assets. You can also invest in condominiums if you know this particular market.
  • Resorts are large up-front investments, but can yield a spectacular amount of wealth if properly invested in.
  • Duplexes are great ways to build plenty of income, as you can fill two units at once with the purchase of a single property. This is a great option for anyone looking to generate a retirement income through Real Estate IRAs.
  • Apartment buildings are heavier investments, to be sure, but since Real Estate IRAs will require that you have a property manage in the first place, it’s not hard to see how they can fit in an ambitious retirement plan.
  • Commercial property covers a wide range of real estate types, from small retail shops to large outlets. Commercial property’s success will have some dependency on the economic climate at large, but they can yield tremendous gains over time.

If there’s a specific property type that you “know” better than another, it might be time to consider investing in a Real Estate IRA. By building wealth over time, you can end up with a tremendous amount of value—which includes income-generating value—by the proper application of leverage and foresight. Call us at 1-866-7500-IRA(472) to talk to us about different types of Self-Directed IRAs and the various investment options available to you.