When you are buying your first rental property or first house to flip, the sheer volume of information out there can be totally overwhelming. You can spend days of your life reading about being successful with investment property that the experts have dreamed up and others telling you how you should invest.
This is all very well but it is best to get down to basics when it comes to successfully buying investment property. You will find a lot of conflicting advice online so focus on the fundamentals and you won’t go far wrong.
When you think about it, the concept of success with investment property is simple. All you need to do is find the right property in the right area at the right price. Other factors certainly help like rising house prices, the demand for buying houses, the demand for rental property and purchasing a property that has renovation potential.
Of course, there is a lot involved in getting to this “success” point. Even if you really know the market in your area well, there is always a ton of research required to find that ideal property. For example, is the property in an ideal location for transportation, schools, colleges or universities if you are planning to rent to students?
You need to research and research again. The truth is that you cannot do enough research. If you make a mistake at this point your investment property project could be a total disaster. A lot of people that are new have a tendency to “jump in” and buy the first investment property that they come across and then wonder why they can’t make a decent return.
Do you have what it takes? If you are really committed to succeeding with investment property then you had better make sure that your mindset is right. You need to set financial goals and know what you want. If you don’t do this then your investment property business is going nowhere from the start.
You have to know the numbers. Crunch the numbers to ensure that you will be getting an adequate return on your investment. Decide what return on investment you want with all of your investment property projects. Don’t risk your money and spend a lot of time on a project where you will only break even or worse.
After buying a house as an investment there is bound to be work that you need to take care of before you can be flip it or rent it out. If you don’t know any skilled contractors in the area then you will need to find them. Unfortunately, there have been numerous horror stories of how properties have been left half finished due to unscrupulous contractors so be careful.
After renovating, you will have to find buyers or renters for your investment property. This can be very difficult to do on your own if you don’t have the right connections in place. There are many devious realtors that will attempt to make more money from you than they should. Do your homework here.
There are so many things that can go wrong with investment property. They could mean the difference between success and failure. The other thing to consider is all of the work that is involved.
The initial research will take a lot of time and then you will need to view several properties before you decide to purchase. Once you have purchased you need to supervise local contractors to do the work that is required. Do you have the time and stamina for all of this?
To be successful with investment property you need to be prepared. There have been many examples of budding real estate investors that have failed because they did not make the right preparations. You do not want to fall into this category. The more prepared that you are the more likely that you will enjoy success.
The time has passed when you could buy just about any property and it would make you money. This was true a few years ago but not anymore. The property market is unstable now and is likely to be for a long time to come so you need to really know the market. If you invest in the wrong type of properties then you will stand to lose on your investment.
It will take time and dedication to really get to know the market. You will need to be across as many property purchases as you can to see what is selling and for what price. There will always be opportunities and it is your job to find them before others do.
If you have a specific target area, then find out everything that you can about it. What are the average house prices? Are they going up or down? What are the average rents? Again, are these going up or down?
There are plenty of ways to find out what the market is doing. You can make connections with local realtors and find lots of information online.
Investment properties can be very rewarding but it is certainly not easy. There will be some tough times ahead and you will need a focused and strong mindset to cope and overcome any problems that you are confronted with. The main difference between really successful real estate investors and the others is their mindset.
You need to set goals and know what you want. Have an open mind when it comes to learning and tackle some of the limiting beliefs that you have that could hold you back. Adopt the belief that you will definitely succeed and develop an iron resolve that is so strong that nothing will faze you.
Inspiration is very important. If you are not passionate about investment property then you are in for some tough times ahead. Mix with others that have already been successful with investment property. Strengthen your own beliefs by looking at examples of what they have achieved.
When problems occur always focus on the solution. Too many people focus on the problem which just leads to stress. By focusing on the solution, you will find an inner resourcefulness that you never thought that you had.
Expect good things to happen and be grateful. If you expect good things then you will get them. Don’t spend your time on negative things. Show gratitude regularly and you will be rewarded for this with continued success.
Trying to do everything yourself is a sure way to failure. You need a good realtor, mortgage broker, real estate lawyer and a team of trustworthy and reliable contractors as a minimum. It will take time to find the right people, but once you have them you must treat them like gold as they will be critical to your success.