subject: Want A Maximum Return On Their Properties [print this page] Do you believe that real estate investing is one of the easiest ways to make money? It's often claimed that with a modest financial investment, and sweat-equity, a property may be bought and sold, yielding a healthy profit. It's certain that the future still looks pretty good to own properties. You'd better think clearly though because much of this work is easier said than done.
A major barrier to success in the real estate investing game is, that it's a steep learning curve. It doesn't matter where you live, real estate investing can be complicated. Real estate is risky and large sums of money can disappear faster than you can say 'stock market crash!' The major tip today is doing your homework. Remember how your teachers and parents always demanded it be completed.
Before getting started in the real estate business, you need to discover how to simplify the process. Prior to investing in properties, spend time considering what financial goals might be yours. Take note of how fast you need to accomplish these goals. Now, be realistic. You'll find it easy to say but hard to do! Housing prices have been rising for several years but like any market, real estate values do go down. When real estate values drop, they do so, sharply.
Make a one year to five-year business plan. Fill in all the detail possible. Look at it all again after half a year. Do the same again after two years. By then you should be well into your new real estate career. Part of your plan should estimate how much capital is to be invested. The investment figure will differ depending upon what you're going to do with the property. Will it be your principle residence? For example, with less than $10,000 to start you are looking at investing in, either your own home, or buying a 'fixer-upper.'
Numerous investors have the notion that they would like to invest in a second property. They can do this, but it's risky. All it requires is a great credit rating and a couple of thousand in closing costs. However, be aware that either the market must rise quickly, or a loss will be suffered. Your alternative is to assume a healthy mortgage plus the additional expenses for repairs. This kind of investment has consequences, where with only a small amount of cash invested you are still legally responsible for the mortgage.
Someone might ask how much risk you're willing to take. Numerous investors want to preserve their invested capital, while others want a maximum return on their properties in the shortest possible time. Consider how much time will be needed. You will want to establish a relationship with a lender. Learn about the market, tax consequences, various contracts, insurance products, and your legal rights.
