I'm Donny. I'm a world traveler, investor, entrepreneur, and online marketing aficionado who has a big appetite to compete and disrupt big markets. I thrive on being able to create things that impact change, difficult challenges, and being able to add value in negative situations.
Real estate is a great field to get into, whether as a primary source of income or as a side hustle to generate income on top of your day job. People who slept on real estate investment for years often feel they’ve missed out on their opportunity, but is this true?
Can you be too old to get into real estate?
You cannot be too old to get into real estate. In fact, there are tangible benefits to waiting until later in life to get into real estate investing. You’ll have more money, time, and an established network, all of which will give you a unique advantage over younger investors.
In this article, I’ll discuss whether you can be too old to get into real estate, the benefits of doing so, and some other relevant topics.
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About Real Estate Investing
Real estate investing is well-known as a profitable investment vehicle for the rich and powerful, but what many don’t know is that more middle-class people can make use of the market to leverage profits for themselves as well.
Renting homes or apartments is actually much simpler than you might imagine, though the liability is higher on your part. Once you get past the initial hurdles of liability and cost, though, investing isn’t as difficult as you might imagine.
Adults of All Ages Can Get Into Real Estate
Many people pass on real estate investing in their younger years, preferring to invest in a more tangible career in their 20s, 30s, and beyond.
Once the dust settles and you’re staring down the barrel at retirement or maybe you’re not even there yet, you might regret not “getting in at the ground floor,” or whatever regrets people have about not investing in Apple or Microsoft early.
Let’s face it - that time is gone and you can’t get it back. You’ll never invest $2,000 in Apple in 1990 and become a millionaire, but you can always decide what to do from this moment forward.
There are no age restrictions on buying or selling real estate, so the real bottleneck is whether you have the time, energy, and money to invest from this moment on.
I know it’s daunting to look back and realize that you missed out on lucrative opportunities, but really, it’s even more daunting to look at the future and decide you won’t do anything with that either.
As I’m about to expound on, investing in your later years may actually be to your advantage. So let’s lose the attitude of what you’ve missed out on and look forward to what you can get into right now, shall we?
Why Waiting To Get Into Real Estate Is Actually a Good Idea
While many would-be older investors look at the real estate market and only see a playground for billionaires and foreign investors, I’d actually argue that waiting to invest at an older age is wiser than investing at a young age.
You have a number of unique advantages waiting until later in life that investors in their 20s don’t have.
If you’re worried you’re too old to get into real estate, chances are that you have retirement savings of some kind and presumably other, more liquid sources of income.
Kids in their 20s probably aren’t going to have the solid foundation of money that you’re starting off with, and this increases the amount of risk you can tolerate, financially speaking, of course.
Buying properties in poor condition can be one way these resources can be put to work for you.
While younger investors might pass on the amount of renovation necessary to bring them up to market value, you may be willing to play the long game on unlikely-looking properties.
Another option is becoming a landlord, which requires making the property livable and dealing with tenants, payment, and repairs, but the steady income can be attractive.
If you’ve retired, you have an advantage in that this wouldn’t be a huge commitment. However, it’s true that screening tenants and dealing with bad tenants give the whole business a bad name.
Simply put, starting out as an older investor gives you options that you don’t have starting out with little time and/or money. You have the luxury of deciding where you want to focus your time, effort, and money, without worrying about day-to-day expenses.
One of the most time-consuming aspects of real estate as a young investor is that you probably don’t have the network necessary to make much money with it.
Successful investing requires you to know when people are selling and buying property, not to mention factors like price, condition, and more.
If you’re retired, you have more time on your hands than a younger investor also juggling a day job, school, or whatever else they have on their plates.
You can devote your mental energy to finding the perfect investments for you, whether it’s buy-and-hold, renting, or house flipping. Each type of real estate holding has pros and cons that we’ll be getting into, but there’s a scenario ideal for just about anyone.
Types of Real Estate Investing
Real estate is kind of similar to stocks in that there are several methods available for investing, depending on your desired commitment in time, energy, and money. You can either actively use real estate to make a profit, or if you’re a hands-off investor, the more passive methods might appeal to you.
This is the simplest, yet the most complicated method of real estate investing. It’s simple because all you have to do is buy it, wait, and sell it. There is no upkeep or dealing with renovations or tenants.
What makes this a complex strategy is knowing what properties will naturally appreciate over time. Many investors in big cities use this method, as foreign investors buy condos and apartments and keep them empty for extended periods of time.
Renting is probably the most involved method of making money off real estate, but that depends heavily on your tenants.
Many older investors buy properties and don’t do their due diligence in checking prospective tenants’ backgrounds and other information. If you have good tenants that pay on time and don’t damage the property, great!
You could have a revenue stream for years.
The downside is that, of course, everything is your fault.
Eviction is lengthy and expensive, especially if the tenants are actively destructive or skip payments. You could end up thousands of dollars in debt if, say, a tenant is addicted to drugs and decided to strip the house’s electrical wiring.
Crazier things have happened! Your mileage may vary a lot when using renting as an investment strategy. Many people love it, and many people emphatically don’t.
House flipping has become somewhat of a phenomenon in the past few years, with prominent HGTV shows focusing on it. It takes talent, patience, and money to take a loser property and fix it up, hoping to make it worth more than your renovations and the original cost combined.
If done properly, it can make a lot of money. But that one property where you can’t recoup your investment for one reason or another can ruin the experience for you.
House flipping is very time and money-intensive, especially if you contract someone to do the work for you.
No matter your age, you can turn your money and attention into worthy real estate investments that will generate passive and active income for you. Being older is actually a pro in many cases because you have more contacts and a solid foundation of capital to draw on.
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I'm Donny. I'm a world traveler, investor, entrepreneur, and online marketing aficionado who has a big appetite to compete and disrupt big markets. I thrive on being able to create things that impact change, difficult challenges, and being able to add value in negative situations.More Posts