In anything, the beginning is always the most challenging part. But it could also be the most rewarding part if done right. This is the same in real estate investing. It’s always a challenge in the beginning, but as you get more familiar with the processes and as you learn new tips, it could be one of your best decisions in life.
To help you in your real estate investing journey, we gathered these 5 tips for real estate investing beginners that you can surely use. We hope that this will make your journey a lot easier and better.
Tip #1: Research, research, research
This is key. It pays to have the knowledge needed in whatever field you are getting into. Educating yourself is like gaining a new weapon. It can be your greatest asset. As they say, “knowledge is power.”
So, never rely on agents or real estate professionals to give you all the information that you need. Go and research on your own. Read books, browse the internet, and ask questions from friends, families, and colleagues who are into the business. Educate yourself and be knowledgeable.
Then, don’t stop there. Make it a habit of learning what you need to learn about real estate investing. Look for the new trends, new properties, and read news about the latest updates. Whatever it is, be informed.
You will also be an effective real estate investor if you learn from the people around you. So, take advantage of the knowledge that you can get from other investors, from individuals who have the same interest in real estate investing, from mentors and seniors in the industry as well as from professionals who offer to share their stories about their real estate investing journey.
Tip #2: Gather People in Your Team
Having all the information in the world wouldn’t be helpful if you do not have the right people in your team. This is the next tip for real estate investing beginners.
You have to choose and gather the people who will be part of your team. This will include the agents, lawyer, real estate attorneys, accountants, and other people who will be involved in your structure.
Remember, you have to choose quality people and individuals who you can trust and rely on. Like in any other relationships, it requires a certain level of trust and reliability for it to function well. This is as true as in business.
Choose your team wisely.
Tip #3: Look at your options
When it comes to real estate investing, there are so many options that you can choose from. The most common ones are single and multi-family rentals. However, you can also venture into other properties like commercial property leasing, leasing of campsites and recreational lands, or you can even venture out into mobile homes investment.
There are so many investors who became successful in investing in non-traditional, off the path routes, as long as you know what to do. Getting help from investors who went into a similar path would be very beneficial to you.
Tip #4: Are you in it to win it?
Why are you investing? Is that investment the right thing for you? Are you 100 percent sure that this is the right investment for you?
A lot of investors failed because they dived into it without testing the waters first. This is a mistake that could easily have been prevented, only if they took the time to evaluate if this is the right choice for them.
This is something that you have to think about before investing your money on a property. Do you have any basic knowledge in house repair and beautification? If you are renting a property, will you be able to manage it or would you hire someone to manage it on your behalf? If you buy this property, will there be a good return on investment or just so-so?
These are questions you have to ask yourself before you dive right in.
Tip #5: Look at your estimated ROI
So the last but most important items on the list of tips for real estate investing beginners is to make sure that your investment is profitable. This should be the first goal when starting. What is a business without profit anyway, right?
There are a lot of rules and methods in calculating your margins. You can follow the 1% rule, which states that the property should bring in a monthly income of 1 percent the final sale price of the property. Then, there’s also the 50% rule, which states that 50% of the property’s profit should go towards the house expenses aside from your mortgage. Either way, these rules will help you in setting proper expectations for your property.
Just remember, you have to set realistic goals and expectations towards your property investing. You don’t want to expect too much, just to get frustrated due to unrealistic expectations.
Being able to do these tips for real estate investing beginners will help you a lot in your real estate investing journey.
If you are looking to buy or sell, we here at BRESS, LLC can surely assist you with some great tips and strategies! Fill out this form now, and our team will be in touch right away! Or give us a call anytime! 866-409-0670