subject: 6 Tips beginners must know before investing [print this page] 6 Tips beginners must know before investing
Have a plan Most beginners so excited over the possibilities of real estate that they jump into any deal no matter what the numbers, risk and strategy and do whatever they can to make it work. This can result in disaster. Not having a plan is planning to fail. Choose one strategy and focus on nothing but that. Document that strategy in a business plan and you will significantly increase your chance of success.
2.Don't close on your first deal until you have 5 deals to cherry pick from Finding deals where the numbers make sense is one of the most important processes in real estate investing. Do not fall in love with your first deal, become a master at finding deal where the numbers make sense and cherry pick from the best ones. Your first deal is the most important deal, make sure it is a home run deal.
Always have multiple exits Make sure you are at a max of 70% LTV and your property cash flows. Do not get stuck with one exit strategy that could fail due to things out of your control. Be prepared for the worst case scenarios and you will mitigate risk.
Don't be a follower and do what everyone else is doing If everyone is doing it, it is probably too late, too saturated and too risky. The best deals have no competition.
Stay away from hot, over hyped, over competitive markets Have you ever heard of buy low sell high? Hot markets you could be buying high, target markets you can buy low and get great LTVs and extremely high rent to purchase ratios.
Generate private money and reserves Banks are not the only way to finance deals. Private money opens up tons of opportunities and is the best way to fund deals in today's market. Cash is King! Having reserves is mandatory as there are always surprises.
Real Return Real Estate for years has bought property at extreme discounts, sells and rents with tremendous cash flow. We also provide FREE tips, articles, guides and Educational Webinars. Visit our site http://www.realreturnrealestate.com for all the helpful resources.
