More than anything, it requires the investor to take the risk. It’s impossible to be a successful property investor without taking that first step.
We have been investing in real estate for almost twenty years and we have had the good fortune of being successful. In those twenty years, we went from almost zero property value to an eight figure real estate portfolio with very little financing. Some of that success was based on luck, but the majority was based on taking some calculated risks, hard work and persistence.
In my years, I have learned my own real estate investing secrets. I cannot give away all of my secrets, but a few of the things that will help guarantee success are.
Caution is good, but don’t let it hold you back. If you can get into real estate by borrowing money, go for it. The worst thing that will happen is that you will have to give the properties back to the bank, lose some time, money and credit score but your will gain some valuable experience. If you lose on the first try, clean-up your credit, recover some capital, learn from your mistakes and do it again. Worse than failure is not having tried at all.
With all of the information available on the internet today, it is very easy to calculate the cost of ownership, the value of the property and the estimated rental income. As a landlord, don’t forget to add in some operating expenses for vacancy, repairs, taxes and insurance. Calculating an expense equal to about one-months rental income should cover the cost of maintenance and leasing expenses (assuming taxes and insurance are paid through your mortgage). If you can combine these expenses with the cost of landlord mortgage payments and still show a positive cash flow, from receiving 11 months of rental income, then go for it.
There is an old adage that the three most important things in real estate are location, location, location and it is true. If you are investing where you live, first make sure that your town is growing and second figure out which way the town is growing and buy in the growth path. If you are more adventurous, you can use the internet to find out which way the larger population is moving and again invest in the growth path of other fast growing areas.
Most buyers look at the structure with little thought about the land or lot that it is on. In most modern neighborhoods today, builders offer a few floor plans choices and all of the homes in the neighborhood are cookie-cutter copies of those dozen or so plans. If you can, choose a property that has some unique and desirable features that are limited to fewer properties, which is often easier to do by choosing the right lot. Examples of this are lots with a view, cul-de-sac lots, lots that adjoin something other than more cookie-cutter homes, etc. Like everything else, real estate is based on supply and demand and having a unique property can make it easier to rent and to sell.
Other tips are:
- Invest in good school districts.
- Buy homes built after 1990 unless you have experience remodeling homes.
- Buy a location or land that has some unique and desirable features.
- Single story is usually less maintenance.
- Be prepared for unplanned expenses.
So many other things to think about. Contact us for more real estate investment advice in the Austin/Round Rock Texas area.
Whether you choose a resale home or a new construction home, buying a house is an exciting investment! Make sure you consider the options to make the best choice for you so that your new house becomes a great home. To help you consider all of the things that you should examine before buying a home, contact ROCK Properties Realty and we’ll help you make sure that your home buying experience becomes a wonderful experience.
Each and every day ROCK Properties Realty strives to create confident buyers and delighted sellers, and to offer world class service anchored by our experience and our unrelenting pursuit of excellence. Our fresh and responsive approach to real estate enables our clients to enjoy a higher level of customer service through talented agents, team-based systems, and cutting edge technology.