Other than Investment Motive, there are also types of investors based on Degree of Control and Legal Entity :
Degree of Control
The category of long-term investor can be subdivided into two categories :
- Active Investors
Long-term investors actually prefer to manage the property themselves. They are the ones who carry out repairs, find tenants and rent their properties. In addition, according to Agen Poker Terpercaya, they can be actively involved in the process of property management and may visit the property several times to ensure that no damage has been done by the tenants. And actively involved in the investment process, called active investors.
- Flexibility : Not required to follow a specific index.
- Coverage : Can also hedge your bets by using various techniques such as short sales or put options, and are able to output specific actions or sectors where the risks to be too great.
- Management of taxes : Although this strategy could trigger a capital gains tax, advisors can strategies tax management as for individual investors, such as selling investments that are losing money to offset taxes big winners.
- Very expensive : Fees are higher because everything you buy and sell triggers transaction costs, not to mention you are paying the salaries of equity picks investigating team of analysts. All expenses over decades of investment returns can kill.
- Active risk : Asset managers are free to buy any investment they believe that bring high performance, which is great when analysts are right, but terrible when they are wrong.
- Passive Investors
There are other long-term investors who have the ownership of the property. However, they do not take interest in managing their affairs of the day. To do this, they hire Agen Poker employees or end up hiring professional services firms real estate management. Since no role in maintaining the property, they are called passive investors. They only provide cash flow to finance the property, and make very few (if any) decisions on management.
Read More : How To Become Real Estate Developer VS How To Become Real Estate Investor
- Ultra low fees: There is no one picking stocks, so supervision is much less expensive.
- Transparency : Always know what assets are in an index fund.
- Tax Efficiency : The buy and hold strategy does not usually result in a massive tax on capital gains for the year.
- Too limited : Passive funds are limited to a specific index or default of investments with little or no variation whole; therefore, investors are locked in such farms, no matter what happens in the market.
- Small yields : By definition, passive funds are more or less not beat the market, even in times of turmoil because their basic properties are locked in to monitor the market.
Finally, the type of real estate property investors can also be distinguished based on the type of legal entity they are. legal entity is important because it determines the amount of responsibility you have.
- Individual Investors : Most investors in the real estate market are individual investors. Individual investors have unlimited liability. This means that if you take out a mortgage on a house and breach it, your other assets can be liquidated to make good the loss.
- Institutional Investors : There are many institutional investors in the real estate market as well. These institutions generally are financed by issuing long-term bonds in the bond markets. Since these bonds have a secondary Agen Poker Online market, which are very liquid and provide investors with the ability to enter and exit the real estate market without any significant discomfort. While, in terms of numbers, the individual real estate investors can outnumber institutional investors, in terms of scale or volume, they are no match for large corporations that invest billions of dollars in real estate investments.
Tags : Real Estate, Properties, Investors, Control, Entity