Rookie Real Estate Investors: Start Here
Investing in general can be very confusing and overwhelming and, if not done right, costly. Real estate investing is not any different. If you are just starting out, here are six things you must do as a rookie real estate investor.
Understanding Your Market
If you are looking at too large of a market to make your purchases you are making a big mistake; this sets you up to become too overwhelmed far too quickly. Instead of looking at a large area concentrate on a smaller area and know it well. You need to know the market in the area to know who will be renting from you, what potential costs could arise, and how much you should be paying for a home in the area. Knowing all these things will allow you to make a smart buy when one becomes available.
Having an Exit Strategy
Exit strategies are important part of purchasing an investment property. You need to know if your plan is to fix the home and flip it or if your plan is to keep it for a period of time while renting. No matter what your strategy is a smart real estate investor needs to know before making a purchase. Your exit strategy plays into your negotiations and your potential return on the investment.
Marketing Plan
You will need to stay on top of the changing market and potential purchases. In order to do this you will want to create a marketing plan that reaches sellers in your target market and focuses on properties which are suitable for your exit strategy.
The Numbers Don’t Lie
Another way to ensure you make a smart purchase is to create a budget and criteria for your property. When considering buying a new property make sure that the space meets the budget and criteria. If it does not meet them don’t buy it.
Sticking with What Works
As your business starts to grow make sure you have a process which works for you. By following this process when flipping, buying, renting, and selling property you can help make sure it is done right every time. You can just follow the steps that you have created for yourself that work.
Keeping Your Word
There are no shortage of “sketchy” people out there which can make you skeptical when working with others or make people skeptical when working with you. The best way to overcome this obstacle is by being honest and upfront with the people you are working with. This way you can create a good reputation for yourself as a real estate investor and entrepreneur, resulting in more people wanting to work with you.
As a real estate investor you will have the potential to make a great living. Make sure you don’t ruin this opportunity by rushing into purchases and agreements without following the guidelines and strategies you have created.