Overview of Property Investment Strategies in 2025

Unlike other forms of investments, where money is placed into a stock or a fund, real estate investments require you to play a large role in your investment returns. With this investment strategy, you make the rules: charging rent, collecting fees, and making improvements to increase the property’s value. The more you invest in your asset, and the more strategically you do so, the more you can expect back.

The vast majority of the world’s richest have real property investments. Though it’s often viewed as a risky business, real estate investing can be one of the easiest and most reliable sources of income for everyday people. Regardless of your rental income, real property almost always increases in value over time, which ensures a profit if/when you decide to sell. This is referred to as long-term appreciation, and it’s one of the main reasons that real estate is viewed as a reliable investment.

In this comprehensive real estate investing for beginners guide, we’ll explore what it takes to become a successful real estate investor, landlord, and property manager and where you should start.

Property Investment Strategies in 2025

There are so many different ways to invest in real property in 2025. Commercial real estate, apartment buildings, and other long-term rentals are among the most popular kinds of investments. Below, we’ll discuss a few strategies to achieve your investment aspirations this year, no matter the path you choose.

Buy and Hold

Easily the most common strategy for rental property investing is known as ‘buy and hold.’ It’s exactly what it sounds like: An investor purchases a property and rents it out to long-term tenants. Some look for long-term rental properties that are already in a rentable condition, then begin renting it out as soon as possible. For this strategy, you’ll want to find a turnkey property, which is a property that needs little to zero work before it’s rented out.

Ideally, these turnkeys are in a flourishing rental market, so that regardless of whether or not you rent the property out, it will appreciate in value over time. When the time to sell is right, property appreciation can increase your return on investment—even if you’ve done nothing but hold onto the property.

House Flipping

Flipping houses is one of the most sensationalized property investment strategies. Rather than looking for turnkey properties, flippers seek out properties in need of serious work. They find inexpensive and often deteriorated units with convenient locations, growing job sectors, and/or flourishing rental markets, and then completely renovate them. Once finished and fully refreshed, they put these properties back on the market for a quick profit.

This kind of investment is best for those with technical skills and/or trusted contractors on hand. Due diligence is required, as some properties can end up requiring more work than they initially appear to. House flipping does tend to be a very hands-on strategy, but if the ARV (After Repair Value) of the home is significant, then it’s a worthwhile endeavor. Many house flippers stick to the 70% ARV rule, wherein they do not purchase a property for more than 70% of its projected ARV. It’s a tried-and-true rule that aims to cushion profits in case the flip takes an unexpected flop or two.

House Hacking

House hacking is a popular investment strategy where an owner rents out part of their own primary residence to a tenant. This strategy often works well with duplexes (where the owner lives in one unit and rents out the other), homes with Additional Dwelling Units (ADUs), or larger homes with multiple floors or rooms that can be rented to individual tenants or families.

House hacking is a great way to get started in real estate for newbie investors, since it doesn’t require you to purchase a separate rental property straightaway and is easier to manage than a long-distance rental might be. It also has tax benefits, as owners can take advantage of some tax deductions specifically for primary residencies. However, it can also be challenging to live in close quarters with tenants and may not be the best option for everyone.

BRRRR

Buy, Rehab, Rent, Refinance, Repeat (also known as BRRRR) is a strategy very similar to house flipping. BRRRR investors also look for run-down properties in need of renovations, but rather then selling soon afterwards, these properties are long-term investments. Once the rehabilitation is complete, flippers begin managing and renting out the property themselves. Then, they refinance the property and repeat the process over again. Refinancing can allow investors to find lower interest rates and better terms, and the money saved can be reinvested into other ventures. In the case of a cash-out refinance, they can even get more physical cash to use for their investments.

BRRRR can be one of the more daunting property investment strategies. It requires patience and financial know-how, but if done right, property investors can build an extremely diverse and profitable BRRRR portfolio. Each property essentially works to build up the next, allowing for bigger down payments, lower interest rates, and future real estate investments.

​​REITs

Real Estate Investment Trusts (REITs) are a simple way to invest in properties without the stress and workload of property management. REITs work a bit like mutual funds in the stock market (in which firms manage the allocated funds of multiple investors together), but for properties instead of company stocks. Instead of purchasing real estate themselves, investors can contribute to a REIT, which will use that money to manage a variety of residential and commercial properties. Their return on investment is received in the form of dividends.

Getting involved with a REIT is a great property investment for beginners. There’s still a promise of return on investment, but you don’t have to become a property manager or be overly involved in order to reap the rewards.

Vacation Home Rentals

Vacation home rentals, also known as short-term rentals (STRs), offer a unique opportunity to capitalize on the growing travel and tourism industry. These properties are typically located in desirable tourist destinations, where short-term rental demand remains high throughout the year. By renting out a vacation home, investors can generate significant rental income during peak travel seasons, while also enjoying the flexibility to use the property themselves.

However, investing in short-term rental properties also comes with its challenges. Managing bookings, maintaining the property, and adhering to local regulations (especially when properties are rented through platforms like Airbnb or Vrbo) can be time-consuming. It’s essential to conduct thorough market research and understand the local tourism patterns before purchasing. Despite these challenges, with the right property and management strategy, vacation home rentals can provide a lucrative and enjoyable investment opportunity.

Property Investment for Beginners

Ready to dive in? Here are the steps you’ll have to take in order to do so.

1. Prepare Your Finances

Before spending any of your money, get a solid idea of exactly what and where your assets are. Take into account your preexisting debts, current income, savings, assets, and any other life circumstances. Then begin to gather proof of income and other financial documents, as you’ll need them when it’s time to finance.

To get approved for an investment property loan in the first place, you’ll need to have a solid credit score. Different lenders in will have varying requirements, but you’ll want your score as high as it can be in order to get the lowest possible rates. You’ll also need to begin saving a sum of money for closing costs, down payments, repairs, and other upfront costs.

2. Do Market Research

Next, you’ll need to decide exactly where to begin your investment journey. Many beginners prefer to purchase properties in a local market, as this simplifies managing and commuting in the future. Redfin is a reputable place to start researching a particular rental market, and its user-friendly tools are simple and easy for beginners to learn.

If you’re investing away from where you live, you’ll want to gather any additional data you can from the local news. This includes information on the state of the job market, growing sectors, local regulations, average property values, vacancy rates, and more. The property you invest in should be in an ideal location for your residents, so consider crime rates, commutes, and nearby schools as well.

3. Pick Your Property Type

In your market research, certain trends should emerge. Are townhomes more popular in a given area than condos? Are studio apartments preferred? Try to understand the wants and needs of the population by looking into nearby listings. If certain property types stay on the market for a while, you may want to stray away from them.

Ultimately, you’ll need to make the most financially sound decision. Try using metrics such as your projected ROI (return on investment) to calculate how much cash flow you can expect for a particular property. This, and other metrics, can help you make an informed investment decision.

4. Financing

Once you’ve landed on a property, you’ll need to finance it somehow (unless of course, you have the funds to pay for it in cash). Research different lenders, both local and national, and don’t be afraid to shop around. Bigger Pockets has a helpful database of investor-friendly lenders, which can serve as a good place to start your search.

Look for lenders who offer the lowest interest rates and the most ideal terms for your mortgage. Some banks and credit unions may have special property investment for beginners tools, which you should utilize if you can.

5. Rent & Collect Rental Income

Following any necessary renovations or repairs, your rental property should be ready to start generating income (unless you’re house flipping). Be sure to create thoughtful listings, advertisements, and thoroughly vet applicants with tenant screening. Taking the time to find trustworthy tenants is one of the best property investment strategies to ensure a return on your investment.

Once the initial work of lease signing is finished, you’ll only have to focus on upkeep—things that will protect your investment. This includes tasks like maintenance (as needed), seasonal preventative care, and building strong relationships with your tenants. Make sure to keep detailed ledgers of both income and expenses for your taxes. With online tools like Ledgre, it’s possible to automate this bookkeeping and financial reporting, which will keep you in touch with your business’s financial health while minimizing tedious labor.

Pros and Cons

​Real estate investing for beginners can be a risky business, but it has its pros and cons. When considering if it’s right for you, take a look from multiple angles.

Pros

• Added Cash Flow: Rental income will add extra cash to your wallet each month—and even if it’s only a few hundred per month, this money will add up fast. It can then be put towards other investments, saved in high-yield accounts, or used to increase the value of your rental property.
• Diversified Investments: The value of your real property won’t be as volatile as other investments such as stocks and bonds. Having a variety of funds can create a sense of financial security.
• Property Appreciation: With proper upkeep, your investment will likely appreciate in value. This means that when/if you choose to sell, you can expect a solid return.

Cons

• Financial Risks: Complications can always arise, and it’s difficult to plan for every single scenario. Sometimes natural disasters, nonpaying tenants, and legal battles can complicate the reliability of your asset.
• Debt: Of course, you’ll probably have to take out a loan of some kind to purchase rental property. If you get behind on payments, you can find yourself in financial trouble.
• Not Very Liquid: Unlike with bonds and other kinds of investments that you can sell with relative ease, real property requires a much more hands-on process to sell.

Conclusion

​Real estate investing for beginners isn’t as difficult as it may sound at first. There are a variety of different property investment strategies to choose from depending on your financial situation and your goals. Don’t hesitate to talk to a trusted financial professional, take calculated risks, and explore tools that can simplify your rental property finances.

FAQs

​What is real property investment?

Real property investment involves purchasing real estate to earn returns through rental income, appreciation, or both. This can include residential, commercial, and industrial properties.

What are the best property investment strategies?

Some of the most tried-and-true real estate investment strategies include buy-and-hold, house flipping, BRRRR (Buy, Rehab, Rent, Refinance, Repeat), and Real Estate Investment Trusts (REITs).

What are the pros and cons of real estate investing for beginners?

Pros of real estate investing include added cash flow, diversified investments, and property appreciation. Cons can include financial risk, debt, and the challenge of liquidating real property.

How do I start investing in real estate as a beginner?

You can begin your real estate investing journey by preparing your finances, conducting market research, choosing the right property type, securing financing, and starting operations to collect rental income.