Real Estate Investing is a great way to create residual income and build long term wealth. In my opinion there is no other business where a normal person can build life changing wealth if they take the time necessary to learn how to invest in real estate the right way, develop goals and action plans, and implement proven business models.
However, one of the biggest mistakes both new and old real estate investors make is thinking that the fastest way to succeed in real estate investing is finding properties at deep discounts, investing a few dollars in repairs, and then selling them at or near retail. Although this strategy sounds like it makes sense on the surface and even may work for a while, in reality it’s what gets many real estate investors in trouble down the stretch. The real key to insuring a long and successful life in real estate investing in The Opus CDL is to look at investors who are successful and study what they do and use their models in your business.
Those of us who have been around for a while and have enjoyed great levels of success in our real estate investing business understand that the very first step should be the development of a business and action plans. If you do not know where you want your investment business to go, how can you expect to get there?
Highly successful Investors understand that you must set clear goals, and make plans to achieve them. Goal setting is a vital component in any business that has achieved great levels of success. Real estate investing can be a daunting concept, especially to those who know little about the subject.
With that said, it is also a concept that can be extremely lucrative and one can learn the basics thereof with a little independent research and some experience in the field of real estate. For those who are new to this arena, there are a few tips to get you well on your way to learning about investing in real estate and feel comfortable doing so.
Research the Subject of Real Estate
Prior to starting your investing endeavors, it is crucial that you know the basics of the real estate field. One way to do so is to engage in various forms of research relating to this topic. This can be done by attending classes on the subject of real estate, finding information online or reading books on this topic. Start out with the basics of buying and selling real estate and then get more involved with how to fix up your investment so that it gains the largest amount of revenue, whether it be by selling or renting the property.
Determine Your Investment Goals As They Pertain to Real Estate
It is also important that you determine what you are trying to obtain from investing in real estate. Are you doing so for the money, the enjoyment or both? Also, determine whether you wish to buy the property on your own or go into the venture with partners. Lastly, it is also wise to figure out if you would like to fix up the property to sell or keep the property and then rent it out to gain money via rental income.
Speak with an Investment Advisor and Real Estate Attorney
Before jumping into real estate investing it is important to speak with professionals in the field so that you do everything correctly. Investment advisors and real estate attorneys are two individuals who may come in handy during the investment process. The investment advisor can detail exactly how you should structure your investment dealings while the real estate attorney can ensure that the purchase and/or sale of the property is done correctly and in a legal manner. Both individuals will be your best friend with regard to this type of transaction and help you to stay on track throughout your investing endeavors.
Determine How Much Money You Have to Invest
You should also figure out how much money you wish to invest in the property and are able to do. Also take into account that certain amounts of money will also have to be provided during the life of the investment for repairs, improvements, taxes and more. Make sure that you have the necessary funds to make the investment a complete success.
Keep an Eye on the Overall Goal of the Investment
Last but not least, those investing in real estate should keep their eye on the prize. In other words, constantly remind yourself why you are doing this type of investment as this will help to keep you on track and help to make your real estate investing venture a complete success in the end. There are many persons who are searching for ways to supplement their present income or to replace it altogether. Real estate investing is one of the major ways people seek to do this. It has already been documented that many of the millionaires in the United States made their first million in real estate.
There are many programs and infomercials on television and other forms of media that are promoting various real estate investing programs. They all purport that you can make millions from real estate investing and in that respect they are correct. In spite of the recent problems in the real estate market with subprime loans, the market remains a viable option for investors.
If you are considering real estate investing, then knowledge of the buying, selling, negotiation strategy, and property repairs process will be very important to you. Having an understanding of these processes will save you from losing your money should something not go as planned. You will also have to be aware of the changes in the marketplace. If you know what is required by the make at any given point in time you can surely make some money and prevent major losses.
Possibly the most common kind of real estate investing is flipping. With flipping you buy a home at a very low cost, spend a little money to do some cosmetic repairs and then sell it at a good profit. For flipping to be effective and profitable, you must invest in homes that are located in areas that have high resale value and a buoyant home market. You could find yourself in a financial bind if the home you invested in cannot be sold for over a year.
There is also prime commercial real estate investing. That is investing in things like factories, apartment buildings, commercial space, and hotels. It is possible to make a lot of money on these types of real estate investments. The trick is to locate properties that are going cheap. It is usually easier to find low cost properties in areas that are underdeveloped and are set for an economic boom.
Real estate investing has its own risks and there is no way of being absolutely sure that your investments will even make you a little profit. With this in mind it is important that you do your research on the direction the market is heading in any particular area you are considering investing in. By doing the research you will be able to make far better decisions about investing.
The real estate investing risks also makes it more difficult, especially at this time in the marketplace, to receive any kind of financing. There are many lenders available for real estate investors but the present climate makes the loan process more challenging. Many real estate investors tend to use their own money to pay for the investment and its repairs if needed. If there is a shortfall in funds some will go to friends and family to borrow the money needed.