www.1001TopWords.com |
Successful Real Estate Investing
One of the best roads to wealth in America has always been the acclimation and development of good, solid, income-producing real estate. Real estate ownership is one of the best ways to achieve financial independence for the average person. But in order to be a successful real estate investor, you are must become above-average in your knowledge and understanding of how the real estate market works. There are five basic requirements that you must follow to succeed in real estate. 1. Write out clear and specific goals that have time lines on them. Set a goal for the exact type of property you are looking for. Do want a single family property? A duplex? A four-unit property. You must be specific. Set a goal for getting the money you'll need to purchase the property. Always make sure your goal has a time line for when you will acquire the property. Will it be six months or a year? Set goals for the amount of real estate you intend to purchase in the next three, five, and ten years. The very act of writing out set goals for yourself in real estate will make it much more likely that you'll have the success you are aiming for. 2. Write out a detailed plan of action, listing everything you are going to do, organized by priority. The combination of goals plus detailed plans will give you a blueprint for real estate accumulation that you can begin to follow on a day to day basis. 3. Make a plan to learn every detail of the real estate business. Because the potential rewards are so high in real estate, they will go to those who have done their homework and paid their dues. It's very important for you to become an expert at real estate before you begin investing your time and savings in real estate acquisition. 4. Be prepared to back your plans with hard work, sacrifice, and persistence. Going into real estate is very much like starting a business. There is a tremendous amount that you have to learn and you can only learn by experience. There will be ups and downs, successes and failures, and you must be willing to persist patiently throughout, knowing that you will be successful in the end. 5. If you are really serious about building something lasting and worthwhile in real estate, resolve to get into real estate for the long term, for a minimum of ten to twenty years. Real estate investment is not something that you jump into and out of. It is something that you step into very carefully, and should be prepared to hold onto for a long time. Many people who purchase real estate, hold it for a long time and then sell it just before it starts to rise rapidly in value. They become impatient when they hear about other people making quick or easy money by flipping real estate properties. The definition of investment real estate in its simplest term is: "Real estate is its future earning power." Let me put this another way: "Real estate is nothing more and nothing less than its future earning power, its value at some future date." In other words, the value of any piece of real estate is determined by the income that can be generated by that property when it is at its highest and best use, from today and on into the indefinite future. An important question that you should always ask when you are considering any real estate investment is, "When and how will income or wealth be generated on or by this piece of property, and in what amount?" The correct answer to that question tells you how much the property is worth today and how much it is likely to be worth in the future. Even though interest rates are at all time lows and property values are increasing at record levels, there are still foreclosures happening at record levels today, because of so many people losing their jobs. Having said this as a warning, there are many things that you can learn and do, starting with very little money, to begin building your financial independence in real estate. If you do not have much money but have lots of time, and you sincerely desire to enter into the real estate field, the simplest way for you to start is to buy homes that need work and fix them up, thereby increasing their value. This is where many successful real estate investors and entrepreneurs begin their careers. Here are six basic steps you need to follow if you are going to buy properties and fix them up. 1. Do your market research thoroughly and look at houses until you find one that is under priced relative to the neighborhood, because it is run down and needs a lot of work. A house that is under priced is one that is selling for 20% or more below what similar houses are selling for in the same area, based on the cost or sales price per square foot. For you, this type of home could be what is called a "Sleeper." It can be more valuable than it appears on the outside. 2. Purchase the house at the lowest possible cash down-payment and get the seller to carry back a second mortgage or deed of trust for the property. Your ideal purchase of investment real estate is always to get the very best price and terms. Price and terms are often more important than any other single factor. If you can get a low enough price and generous terms you can make almost any property into a successful investment. 3. Move into the house and begin working on it on the weekends to renovate and refurbish it, doing all or most of the work yourself. Many husbands and wives have launched themselves toward financial independence by working as a team to buy and fix up houses, approaching this as a family project. 4. When you have fixed up the house and yard so that it is attractive again, you can then do one of three things. You can sell the house for more than you paid and take the profit from the sale and buy another house to renovate. You can rent out the house at a rate that covers your mortgage payment and hopefully gives you extra cash flow. Or you can rent out the renovated house and then refinance the property, often for as much as you paid for it, based on the higher earning power of the property when you rented it. 5. You can then repeat this process with another house, again doing the renovations yourself until you have fixed it up and you are ready to sell, rent, or refinance the second house as well. 6. As you increase your assets, your cash flow, and your experience, you move up to buying and fixing duplexes and eventually apartment buildings. There are two main advantages to buying properties and then fixing them up yourself: First, you can do it while you keep your full-time job, continuing to generate cash flow from your job for repairs and renovation. Second, you can start small, with little or no money, little or no risk, and expand your activities as you gain more knowledge and experience. Making money in anything, especially real estate, is hard work and requires persistence. Everyone with a property for sale wants to get as much of your money for it as he or she possibly can. Your job is to see that they don't. So, if you are willing to do your homework and take your time, you can make prudent and profitable real estate purchases and sales. You make your money when you buy real estate, not when you sell. You make your profit in real estate by buying right, by buying the right property at the right price and at the right terms. When you sell, you simply realize the profit that you made at the time of the purchase. Another important rule for investing in real estate is this: don't become emotional about a property that you are purchasing for investment. Always look at the property from the viewpoint of a critical purchaser. Purchasing real estate of any kind requires careful thought and analysis. Just remember that you are buying the long-term future earning power of a piece of property. You are purchasing the property as an asset and nothing more. Always remember, real estate is only an asset if it puts money into your pocket. These rules are all food for thought if your are planning to become a real estate investor. These are some basics that you need to know to get started in the field of real estate. Read books and attend seminars on a regular basis in the field of real estate. Go out and look at properties every week that are for sale, even if you are not ready to buy. By doing this you will be gaining valuable experience. Nothing can take the place of knowledge and experience, especially in the field of real estate. Millions of men and women have become financially independent by investing in real estate, and with the proper knowledge and experience, there is no reason why you cannot do it as well. Copyright© 2005 by Joe Love & JLM & Associates, Inc. All rights reserved worldwide. Joe Love draws on his 25 years of experience helping both individuals and companies build their businesses, increase profits, and achieve total success. He is the founder and CEO of JLM & Associates, a consulting and training organization, specializing in personal and business development. Through his seminars and lectures, Joe Love addresses thousands of men and women each year, including the executives and staffs of many of America's largest corporations, on the subjects of leadership, self-esteem, goals, achievement, and success psychology. Reach Joe at: joe@jlmandassociates.com Read more articles and newsletters at: http://www.jlmandassociates.com
|
RELATED ARTICLES
Real Estate Inspection - Do Your Own Why should you do your own real estate inspection? To get a better deal. It isn't necessary to learn building codes, and you probably should use a professional inspector in any case. The point of learning what to look for is to have negotiating points. San Diego Real Estate San Diego is home to millions of beautiful apartments, condominiums, and single-family homes. Depending on the type of living arrangement you're looking for, and how much space you'll need, you should look at the appropriate San Diego real estate listings that fit your preferences and budget. Here are some of the San Diego real estate listing options you'll find: Should you Sell your Home yourself? Should you sell your home yourself? Yes and no. Yes, you should leave the option of selling on your own open and no, you shouldn't rule out using the services of an agent to help you sell. There are a considerable number of advantages of using an agent to sell your home but their services do come at a price ? up to 6% commission on the sale price! That's quite a sum, a precious $6,000 for every $100,000 your home is worth. Agents are not indispensable. With the advent of the Internet, a fairly sizeable number of owners have been able to successfully sell on their own. Statistics have it that 80% of home buyers begin their search for a home online. So, putting your home details on the Internet is one effective medium of advertising your home and reaching out to a large number of buyers. Buying and Selling Real Estate: Negotiating to Win-Win You don't get what you deserve - you get what you negotiate for. The Irish Property Market - Expensive But Worth It? Lying on the edge of Europe facing out to the Atlantic Ocean sits Ireland, one of Europe's smallest countries and often described as 'The Emerald Isle". A beautiful country characterised by vibrant, colourful cities and towns set amidst endless unspoilt green fields, Ireland is now officially the best place in the world to live. Combining increasing wealth with traditional values gives Ireland the conditions most likely to make its people happy, according to the Economist's quality of life assessment for 2005. Real Estate: Choose a Realtor You Can Trust Today's volatile real estate market involves complex laws and fluctuating financial conditions. Maybe you've outgrown your first home; maybe you're in the process of turning over your fourth. Whatever your unique set of circumstances, you want to be well-informed every step of the way. Thus, it pays to choose your real estate advisor carefully. Basic Tips for First Time Home Buyers Choosing a first home can be a daunting task, but following a few key steps makes it a lot less confusing. Relocation Humor: Why I Bought A House The Rental Experience in South Florida Selling Your Own Home ? Pet Issues If you are selling you own home, you need to consider the effect of pets. People who are working with a real estate broker are sure to get coached about the potential negative effect of pets. If you aren't working with a broker, this article discusses the pet issue. How Do I Implement The Lease Purchase Plan? Well, as we have discussed in previous newsletters first you have to set up goals for yourself, both long term and short term. Don't forget these goals define how your business is run. They will determine what you do on a daily, weekly and monthly basis. The best way to do this is to picture yourself a year down the road. Close your eyes and get a mental picture of where you want to be, what you want to have, how you want to look, then open your eyes and write all that down on paper or speak into a voice recorder. Use Targeted Decorating To Get A Higher Price For Your House This article will show you how to sell your home quicker, get a higher price for it by using smart decorating techniques. Seller Objections To Lease Purchase A large percentage of the mail we receive are from people that complain that sellers don't want to do a lease purchase, they just want to sell their house. Or sellers come up with too many objections. My questions to those individuals are: Tax Free Exchanges: Watch out for the New Residence Rules On October 22, 2004, President Bush signed tax legislation that contained a provision affecting Internal Revenue Code section 1031 (the like-kind tax-free exchange rules). Why Mobile Homes? There are mobile homes for sale, for much less than stick-built houses, in most areas of the country. Despite persistent predjudice against them, and sometimes the people living in them, mobile homes are the cheap housing choice of millions. The advantages are not always obvious, but they are real. Real Estate Local FAQs. There are many frequently asked questions and any local real estate area. In our area here at the local Delaware Beaches, the most frequently asked questions are how to get a good deal and if there are any fixer-uppers available. Safe, Scenic & Secure Sussex County Delaware As I write this, there is a considerable concern about the dangers of urban life, triggered by the terrorist attacks on the USA. As some of you know, I have been a student of disaster preparations and a real estate consultant for those seeking "secluded and survival properties" for over thirty years. Real Estate Investing: How to Choose a Lender To become a successful real estate investor it's vital to have a long-term relationship with a good lender. Having a flexible lender who knows your needs and objectives can be the difference between success and failure in your investment career. Property Investing - Am I Buying for Profit or Prestige? All of us have emotional preconceptions and assumptions. They are reinforced and fine tuned by our experiences of life, be they traumatic, disciplined or consistent. Our brains are designed so that the emotional patterning centers mature while we are still in utero, whereas our rational centers begin to mature at about 4 years old and finish maturing through adolescence to early adulthood. Non- rational emotional patterning is therefore a design feature!! Should You Sell Before the Housing Bubble Pops For the past several years housing prices have risen dramatically. With interest rates continuously moving up, and more and more people being priced out of the market, all signs point to an imminent housing market correction. So should you sell your home now before prices drop or should you stick it out and see what happens? It really depends on your individual situation. Take The Guess Work Out Of Your Wholesale Property Purchases We have become very concerned by the number of readers writing to us asking how to determine which are the wholesalers(*) that can be trusted. Why are we concerned? Because when we dig a little deeper, we realize that they are buying properties based solely on the recommendation of the wholesaler. They're guessing which ones to trust, and which houses to buy. That's a dangerous way to do business. |
© Athifea Distribution LLC - 2013 |