To become a successful real
estate investor one must have the capability to identify good real estate deals
and invest in them. You should also be able to assess the true value of
properties based on when you expect to sell. Your purchase must be made at a
reasonably low price to allow for a profitable sale at a later date.
Real estate investing is a
strange type of profession that has no accepted curriculum of formal training.
The only way to learn the art of successful art of investing in real
estate answer is for you to find a mentor who can teach you the secret
formula. You must become an adept at appraising and finding out the true value
of a property as this information is critical to make an informed investment
decisions. Realtors, appraisers, and banks determine what a property is worth
by studying recent comparable sales in the same neighborhood. You must be able
to do the same.
Leveraging is key factor for
investors in real estate because the less cash you part with on each
transaction, the more properties you can buy with your total available money.
If you are long-term real estate investor, leveraging will work in your favor
if the markets in which you invest appreciate in the long run and your income
from the properties can pay for most of your monthly debt.
Exit strategies are also equally
crucial to successful real estate investing. As a real estate investor you must
know exactly when to sell the property even as you buy. You must completely
study the market and your work out your plan even before you invest. Real
estate investors can help you interpret market indicators such as the
average length of time houses have been on the market. This information it will
help you make better investment decisions.
Successful investors make it a
point to review their portfolios at least once a quarter and work aggressively
to get rid of the losing properties before they can seriously erode the profits
from their winners. Bestow enough attention to protect your properties from
creditors, plaintiffs, and the taxman. It is no doubt complicated, and time
consuming - but yet every successful real estate investor takes the time to do
it, thus assuring that their hard-earned money is not imperiled.
To succeed in real estate
investing, you must cultivate the art of moving with people as the real estate
business is built around people - sellers, tenants, contractors, agents,
financiers etc. Since there is no written code of ethics for real
estate investors, it is up to each investor to decide how he will deal
with customers, tenants, sellers, workers etc.
Do your market research
thoroughly and look at houses that are priced lower than comparable properties
in the neighborhood. Purchase the property with the lowest
possible cash down-payment and get the seller to carry back a second mortgage
or deed of trust for the property. If you can get a low enough price and
generous terms you can make almost any property into a successful investment.
Finally, one last important rule
for investing in real estate is - do not become sentimental about a property
that you are purchasing for investment. Always look at the property from the
viewpoint of a critical purchaser and a businesslike investor.
