Getting Started Investing in Real Estate
Real estate has long been considered a conservative, long-term strategy to growing wealth. You can also start building an asset base and seed capital with short-term transactions. While some seasoned real estate investors make it look easy, to be successful, beginners should follow some basic principles.
·Learn all you can. Invest in education before you invest in properties. Before committing your cash, you should have a fundamental understanding of real estate. For example, be aware that, in general, investment properties are not liquid investments. Barring exceptional circumstances, real estate does not sell at a moment's notice. It could take days or months to sell a property, depending on the strength of the market in a particular region.
·Get professional help. A Mentor/Coach can show you the right path to follow. Teach you the strategies and principles first hand, showing you how to avoid those costly trial-and-error pitfalls and also get the maximum return on your time.
·Consider cash flow. You'll need to have enough capital on hand to cover any short-term losses due to vacancies between tenants. Utilize your lines of credit as investment tools. Get high credit card limits for business purposes ONLY!! The wealthy use their credit cards to make money, not to buy consumer goods.
·Start small. Look into buying a single family home or a duplex. Leave large apartment buildings and commercial properties to the pros.
·Inquire at the local Chamber of Commerce about companies relocating into or out of the area. Company movement is one indicator of demand for rental and/or office space.
·Research the property The most common way first-time investors lose is by failing to investigate a property thoroughly. Look beyond the front door. Investigate the reputation of the school district, the crime rate, and plans for expanding a nearby highway or developing vacant land. Ask a local real estate professional about the area, its history, and how fast (or slow) properties are moving.
·Spend time driving the streets of the neighborhood noting the condition of other properties. Are lawns maintained? Are roofs in good shape? Are homes kept up? What are homes renting in your area?
·Be ready to make fixes quickly and respond to the renter's needs. If you're not prepared to be a hands-on landlord, consider hiring a property management firm.
Remember, investing in a property is much different than living in one, you can minimize your risk and maximize your profits with experience and education.
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