The Short-Term Shop

How to Invest $100,000 in Real Estate and Turn a Reliable Profit

How to Invest $100,000 in Real Estate and Turn a Reliable Profit

While having a large sum of capital ready to be invested might sound like a pipe dream to many, the reality is that, more often than not, if you are fortunate enough to have one hundred grand to invest, deciding where to put that investment capital can quickly become an overwhelming ordeal.

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As a general rule of thumb, the more money you find yourself having saved up or inherited, the more you’ll be able to pick and choose when it comes to finding investments to make the venture truly profitable. This is true even for an investing newbie.

When wading through the options available, most investors will soon realize that real estate is largely considered the safest, most reliable investment opportunity on the market, but not all real estate investing options will be as profitable and sustainable as investing in the rental market.

But what exactly makes the rental market the top choice for investing $100,000, and what strategy is likely to work best?

Here’s all you need to know about the benefits of real estate investing, investing in rental properties, and in particular, putting your hard-earned money into the short-term rental market.

The Benefits of Investing in Real Estate

Before we dive into why the rental economy - in particular holiday rentals and short-term rentals - makes for such a sound investment in today’s market, let’s have a brief look at the overall benefits of real estate investments.

The biggest and most obvious benefit of this investment strategy is the fact it results in ownership of a real, tangible asset with strong, reliable cash flow over time, especially in the case of rental properties when combined with the rise of rent prices, inflation, and equity. Additionally, this type of property can experience a possible increase in its value in the future through appreciation

Another key benefit of investing in real estate is the generous tax breaks that come with it, as owners can deduct many of the operating expenses of owning and managing a property when tax season comes around.

On top of building equity and exponentially growing one’s wealth over time, investing in real estate can also help ambitious investors diversify their portfolio with a low-risk, high-return investment.

What Is the Best Way to Invest $100,000 in Real Estate?

Now, it’s important to understand that even though the real estate market as a whole presents fewer drawbacks and more advantages compared to more volatile investment strategies, not all ways to invest in the industry are created equal.

The best way to invest $100,000 in real estate is, ultimately, the way that fits your strengths and investment goals best.

Nice House

Those just dipping their toes into the market who have little time and resources to spare for managing their investments directly, for example, can pool their investment capital together with others in a REIT, obtaining higher dividends than those offered in most stock trading options.

Those with hefty investment capital like $100,000 or above might, however, fare better by investing more time and research into building their property empire, either becoming “flippers” or renting out their properties to long-term or short-term tenants.

Of course, working as a landlord (or even as a renovator) comes with plenty of responsibilities, requiring not only hands-on involvement in the managing of the property but also plenty of knowledge of the local housing market, the attractiveness of the location, and the best way to market the house itself.

But if investors are willing to take the leap and put their wits into their real estate investing strategy, the benefits can be enormous.

Why Are Rental Properties the Best Way to Invest $100,000?

One of the safest ways to invest $100,000 is to invest it all in one single property, usually a single-family home, and turn it into a rental property.

This strategy guarantees a stable and passive cash flow that is likely to increase gradually over time, all while requiring very little hands-on work. 

At the same time, the returns investors will see from one single property will be quite low compared to what they could gain from investing in multiple rental properties, even though the risk and time invested in the latter strategy would be much larger.

Ambitious investors can also put their $100,000 down as a deposit on a multiple-unit apartment building that’s able to generate the most amount of income, but that would require a demanding loan, plenty of management skills, and a full-time commitment to see a sustainable profit. 

But not all rental solutions require renting to one family at a time, waiting patiently for the rent price to increase, and having to deal with problematic tenants!

Short-term rentals, a little-known but incredibly profitable investment option for investors willing to put in $100,000 or more, are some of the safest and most high-return real estate investments you could ever make.

Why Are Short-Term Rentals a Good Investment?

Short-term rentals, also known as vacation or holiday rentals, can offer the best of both worlds, allowing owners to turn a consistent profit through a much higher average monthly rental income compared to long-term rental options and a considerably lower risk of payment default, since most payments for short-term accommodation are made upfront.

Car and Property

On top of the opportunity of turning a significant profit, investing in short-term rentals allows property owners to avoid the hassle and time-consuming routine of dealing with problematic tenants, last-minute repairs, evictions, and, in the case of successful properties, the high cost of long-term vacancy periods.

As a whole, the short-term rental market is often considered as recession-proof as an investment can get, provided that you start investing at the right time, market your accommodation properly, and adjust the price of your listings according to the season and demand.

With $100,000 available, investors can easily start investing in a low-maintenance property located in an attractive area for local and international visitors, getting all the safety benefits of investing in a single home while also reaping the benefits of the flexibility of the model: When your short-term tenants leave the property within the agreed date, you’ll have a much easier time booking new visitors right away and adjusting your prices quickly depending on the state of the market.

Of course, running an active short-term rental business requires great knowledge of the sector, good marketing skills, and an upfront investment when renovating and operating regular maintenance tasks.

But with the opportunity of making more than double the amount of income from a vacation rental than you’d make with a long-term rental property, investing in short-term rental accommodations is one of the most underused yet profitable ways of making your $100,000 grow.

Your One-Stop Destination for Investing in Short-Term Rentals

As forward-thinking investors start going against the grain and investing in more creative, high-return real estate investment options, the vacation rental market will continue to gain popularity across the US and abroad.

If you want to be ahead of the curve and put your investment capital into a high-profit, growing industry with thousands of opportunities, The Short Term Shop has all the information you need to get started and thrive as a short-term rental business owner get in touch today to learn more about your new $100,000 investment opportunity!

Avery Carl

Avery Carl

Avery Carl was named one of Wall Street Journal’s Top 100 and Newsweek’s Top 500 agents in 2020. She and her team at The Short Term Shop focus exclusively on Vacation Rental and Short Term Rental Clients, having closed well over 1 billion dollars in real estate sales. Avery has sold over $300 million in Short Term/Vacation Rentals since 2017. An investor herself, with a portfolio of over 100 Doors, Avery specializes in connecting investors with short term rentals with the highest ROI potential, and then training them to manage their short term rental from their smart phone from anywhere in the world.

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