Feb 052014
 

When you are searching for new investment acquisitions, do you know your exit strategy before you close on the deal? What measuring stick do you use to determine if you are going to hold a property short term or long term?

Once you think you’re going to get into real estate investing, you should set up either an LLC or a similar entity. This helps protect you and your investments. It will also help boost your chances of getting tax benefits thanks to your business dealings.

Investors use varying matrix’s to determine how long they are going to hold a property. Depending on your investment strategy, you might achieve your financial goals sooner than later, so a short term hold may be the answer. You might be in a high growth market and want to hold longer to capture more of the appreciation.

Find people that are in this business and learn everything you can from them. There are lots of people that want to get into investing in real estate. There are a lot of people who like to speak about this subject. If none are located in your area, you can find forums online where other investors hang out. Get out there and learn from your peers can teach you.

I recently interviewed one of the successful investor who built large portfolio in short time period. Here’s how he determines if the exit strategy will be short or long term:

Problems with tenants can waste a great deal of time for you.

“If I see property, and I do my rehab, and if my rents per square foot are below 70 cents, that’s going to be what I call the Casa. Casa’s usually are deals that I’m going to hold for two years because I’m below 70 cents (per foot per month), usually I’m in a submarket that – it’s okay. It’s not the strongest, and I don’t believe that submarket is going to actually improve maybe for the next five years. However, I’m buying that property for a very good discount.

Be sure to choose regions that have good reputations and where lots of people want to live. This is very important as it will give you the most amount of resale value when you go about your purchase. Try finding property that you can easily be maintained.

If I’m in a submarket that my rents per square foot are above 70 cents, I call that property a Villa. Villas are properties that my holding time is going to be anywhere between 3 to 5 years, or even more than that. I’m going to be in a submarket that I have a much stronger retail – not only mom and pop – but you’re going to find a Home Depot; maybe we’re going to find a Wal-Mart.

Properties near businesses or water can earn you a lot of money.

If I have a Casa and I have a Villa, my rehab changes a little bit. It’s going to be a little bit cheaper for Casa’s. For villas, everything’s a little bit more expensive because it’s directly related to my tenant profile. All my rehab is going to change a little bit, depending whether it’s a villa or a casa.

Understand that your time is money. You may love rehabbing properties, but is all the manual labor really the most productive use of your time? Or would you be better suited to looking for the next opportunity? This will let you to focus on the important details.

It gives us very good direction. For us, before we buy the property now, we have a very clear plan. If it’s above 70 cents it’s a Villa and below 70 cents it’s going to be a Casa. We always have a plan. “

Be very patient when you are first starting out. Your initial real estate investment transaction may not happen as fast as you expected. Don’t get anxious and the perfect investments. That is not a recipe to waste money. Wait a great investment that’s great.

Decide on a short term or long term plan and exit strategy for your properties. If your properties are in low growth markets, and you can quickly realize value, then a strategy to sell sooner may make sense. If your properties are located in high growth markets, then riding the appreciation tide may be the answer. Whatever matrix you use, make sure you have a strategy and a plan for your properties.

Jan 282014
 

People around the world love investing in real estate to make money, but there is also the chance of losing a ton of money. To realize your goals and keep a tight grip on your money, the advice that follows should receive your full attention. Continue on for helpful information about real estate investing.

Spend some time finding others will similar interests and trade insights. Lots of people want to get involved in real estate investments. Business groups are beginning to form in many areas to serve the needs of real estate enthusiasts. There are many forums that you can go to talk to people. Get out there and see what your peers can teach you.

If you’re planning on investing in real estate, you’ll want to make sure to take time to learn all that you can and have time to give to the business side of it on an ongoing basis. This means that you may have to cut back on an activity to end up making more money in the long run. Toss that softball league or poker night to make yourself a better investor.

If you want to be a real estate investor, you need to consider how much free time you actually have to devote to the enterprise. Tenant problems can really kill your time. If you really don’t think you have time to do these things, a property management company should be hired to assist you.

Do not assume that the value of property will always go up. Its a dangerous thing to assume when considering a piece of property. It is much safer to invest in property that is already producing an income. If the property value increases as well, that’s just icing on the cake.

If you are seeking a good investment property, take care to assess its potential for increased value. Remember that good location is a plus when it comes to excellent resale value. Think about long-term projects and costs rising later on, which can boost your original investments.

You want to be educated concerning investing in real estate prior to making any purchases. Mistakes in investing in real estate could leave you in a big ditch. Training is an investment more than an expense, and it helps you protect your money for years to come.

When you are buying real estate investment properties, have someone who is handy at fixing things to help you out. If not, you might find your profits are eroded by having to pay for pricey repairs. A reliable handyman is great for tenant issues that may arise during the day or night.

Buy local properties. Since you are familiar with the neighborhood, you are not taking as great a risk. Plus, if you’re renting, you can be more secure in the fact that you know what’s going on in the place. The true way to control the investment is through self-management because it is nearby.

After reading the above article, you should be well-versed on what it takes to succeed in real estate investing. If you fail in following these tips, you might risk losing lots of money. Keep an eye out for books and articles with tips that can help. Ideally, you will find a profitable venture.

Jan 142014
 

It can be difficult to find reliable information on real estate investing. If that sounds like you, look no further. Keep reading for a great education about this subject.

It is a good idea to incorporate yourself when you are going to be a real estate investor. This will protect you down the line. In addition, you will be able to qualify for tax benefits as a result of your business dealings.

Always find out about the values of other properties in the area. Local mortgages and rent rates will teach you more about a property’s value than some financial statements. This will allow you to make a better decision regarding a given property.

Look for like-minded individuals and try to learn from them. Many, many people have an interest in investing in real estate. There are certain community business groups who feel the same way. Or you can also find many online as well. Mix it up with these people and learn all you can.

Find your comfort zone and stick with it. You can have much more success at real estate investing if you stay focused within your market niche. Whether you’re buying and selling homes, only working with starters, or dealing in properties that cost low in the down payment department, stick with the things you are familiar with.

If you are considering real estate investment, then you need to consider just what kind of personal time you are willing to put into property management. Problems with tenants can waste a lot of time. Before it becomes overwhelming, it can be a smart choice to get the help of a company who can handle property management for you.

Make sure you choose areas that have a buzz around them, especially if you can tell that early on. This is something that’s important because it will help the resale value of your purchase. Also, you should only choose easily maintainable properties.

Factor in the ability to rent out the home that you buy when you are projecting what a home is worth. This can help you make thousands during the year from others who live in it. You can then go on to resell the home and make a significantly larger gross profit.

Understand the value of your time when it comes to opportunities. Are you getting into rehabbing properties but aren’t factoring in the manual labor time? Would your time be better used searching for new properties? Whenever you can delegate a task to someone else, do so. Keeping your time free allows you to focus on the important angles for your business.

Try using a company that specializes in property management. It will be well worth your money. An experienced property management company can effectively screen potential tenants as well as managing repairs and maintenance. This will give you more time to look for other lucrative real estate opportunities.

If you take the time to educate yourself, real estate is a subject anyone can master. You must always increase your knowledge of investing in real estate. Anyone can learn, and now that you know more about it, your investment skills will take off.

Jan 052014
 

There are far too many people who jump into the real estate investment arena without learning how to go about it properly, which can be a big money mistake. Fortunately, you have great information at your fingertips. Continue on for a good education into the world of real estate investing.

Always familiarize yourself with property values in the area. The cost of mortgages and rent in the neighborhood is a better indicator than financial statements when providing a picture of the house value. Looking at the situation from the street level helps you make better decisions.

Find people that are in this business and see if they will help you. Real estate investing is a popular field. So many people, in fact, that there are many community business groups that focus solely on this passion. If you can’t find anything like this where you live, there are a lot of forums online where you can speak with investors. Join them to learn more.

Find a market you enjoy. You can have much more success at real estate investing if you stay focused within your market niche. Perhaps you want to work with fixer-uppers, starter homes or even renting; the key is to find the segment you like and have success with.

Get to know other investors in your local real estate market. It’s a good idea to talk to other people and to hear what kinds of advice they can give you if they are more experienced than you. A few friends knowledgeable about real estate investment can be handy. You can find like-minded people by looking online. Join forums to learn as much as you can.

If you are looking to invest in real estate, you should think about how much time you can devote to managing your property. Issues with tenants could keep you really busy. Get a management company to do the dirty work for you.

Choose places that are relatively well known where people might want to move or live. You increase the potential resale value of your initial investment. Also, try to look for properties that can be easily maintained.

Rising property values are not always a given. That can be a costly assumption. Instead, you should look for property that offers quick cash flow boosts. Property value appreciation will help you invest in future properties.

If you buy a rental property, be wary of the person you allow to rent it. The person who is renting out the property should have enough money to come up with a deposit, along with first and last month’s rent. If they do not have all of the money to begin with, there is a greater potential that they will be unable to maintain payments. Get someone else.

You want to get into real estate as a way to buy low and seller higher, and the information provided here should help you do just that. Be sure that you carefully study what the market is like and the investments you make will pay off for you. You will find success if you apply yourself with your real estate investments.