When you set out to pursue your real estate investment dreams, you will find an overwhelming number of properties waiting to be purchased. Foreclosed homes, distressed properties, short sales with lower than market value costs and bright investment opportunities are waiting for investors like you to seal the deal. However, not every investor finds success; the primary reason being investment in the wrong property. So, how do you know whether you’re investing correctly? How can you judge the value of your investment?
Knowledge!
To find success as a real estate investor, you need to know what you’re doing. And in order to know what you’re doing, you have to devote a few initial hours of your time to study what the real estate industry entails.
No; you don’t have to take up a year-long course to study real estate neither do you have to prepare for a research paper. You just need to acquaint yourself with the basics to be able make well informed decisions when you invest.
Sources for Real Estate Knowledge
- Published books
- Online articles and forums
- Real estate magazines
- Real estate seminars
- Local real estate agents
- Meetings with established real estate investors.
Once you know where to look, you need to know what to look for and what to study.
- The Local Real Estate Market – Study the market you’re planning to invest in. Research buying habits, research the best areas for investment and determine what type of property people are looking for. Keep an eye out for fluctuations in this local market and determine the average value of properties in the area.
- Financing Options – You ought to know your financing options before you invest so that you waste no time in sourcing funds when a bright investment opportunity presents itself. Educate yourself with the financial workings of an investment and the procedures involved.
- Value Determination – Once you’ve seen professional investors at work, you will learn how to determine the value of a property. This is one skill you, too, will have to imbibe to help you make the right decisions. Any property is worth buying only if you are certain you will make a profit from it.
- Negotiation – The art of negotiation can go a long way. The less money you invest, the more money you can make. Learn the right negotiation strategies to haggle with sellers, contractors, professionals and others involved in the investment process.
- Contractor Fees – You will need to know the market rate of landscapers, plumbers, electricians, carpenters and roofers so that you do not end up paying more than the average rate when you hire such services for your investment property.
- Value Enhancing Factors – Will adding a garden in the backyard improve the value of the property? Or will you never be able to find a seller after installing that garden because the home is primarily designed as a bachelor pad? Knowledge about the type of renovations that will work and that won’t can go a long way.
Knowledge about these basics can safeguard every real estate investment from turning void.
