There are many people who are interested in buying or flipping homes. However, few people know what steps to take in order to get the process started. TV shows make it look easy, but in real life there is a lot of hard work that goes on behind the scenes that shouldn’t be ignored. If you’re thinking about taking the plunge into real estate investing, start here.
You Must Have a Plan:
It’s not wise to wake up one morning and decide you’re going to go buy your first investment property that day. First, you need to learn the business, understand the risks and make sure you’re ready to take on a big financial and time commitment.
It’s a good idea to lay out a multi-year plan that outlines your short and long term goals, overall budget and primary investment strategy. Once you’ve laid the groundwork, you can start researching specifics. This includes things like figuring out the best route for financing, determining which neighborhood or neighborhoods you want to invest in, deciding whether you want to purchase commercial properties or residential homes and so on. With a well-developed plan in place, you’ll dramatically increase your chances of making real estate investing into a lucrative career.
To Flip or Not to Flip:
Flipping houses is the play of choice for many investors but it’s not necessarily the best starting point for someone who is brand new to the space. While it can be (and often is) profitable, there are also lots of risks involved. If you’re considering flipping as a career move, read this post first to find out if you’ve got what it takes to be successful.
Don’t Underestimate The Power of Rental Property:
Quick flips with big returns are attractive for obvious reasons, but long-term rental units can provide consistent returns for years and years. You benefit from consistent income as well as any appreciation that builds on the property, and if the market peaks, you have the option to cash out on your investment. Both of these variables working in your favor can go a long way in helping you reach your financial goals.
As you get started, plan, invest in a way that will allow you to reach your goals and always have some cushion in case you encounter unexpected bumps along the way. Happy investing!
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