Getting Started in Real Estate Investing

Real estate investing is a difficult and challenging, yet rewarding, business. Once you’ve decided that this is a path you want to take, then you must do your part to prepare yourself for success. Before you begin in real estate investing, keep these five keys in mind.

Know the Market

Before you go diving into the vast market that is real estate, you need to know what you’re getting into. Knowing the types of markets near and available to you is very important. Every real estate investor should have one or more target markets, such as the types of houses, likely repairs, property values and reliability of potential buyers. This knowledge will help you identify opportunities and handle deals as they present themselves.

Have an Exit Plan

If you want to be successful in real estate investing, you need to define a process and a structure that works for you. You should also have a clear exit strategy as well. One of the more common strategies in real estate investing is to invest in residential real estate, such as buying and flipping homes, buy and hold, and wholesale. One way to decide which exit strategy works for you be in understanding where you want to go with your real estate investing.

Consistent Marketing

In order to find the right number of leads to keep your business growing you must know how to consistently market to truly motivated sellers. Find the properties that are within your target market and fit with your exit strategy. You should build your marketing plan around the types of properties that you want to find and invest in.

Trust The Numbers

Create a checklist of what costs could and will arise as a result of investing. Keep your numbers realistic and know what you can spend and what you can’t. You need to know when to walk away from a deal that doesn’t suit what you have or will have; in many ways, the property you never buy can be your best investment. It’s tempting to think that you can trim a few hundred or thousand dollars easily from the cost of a project, but you must stay real with yourself and your project.

Be Realistic With Everyone Involved

In order to set yourself apart from the competition you should tell the truth and be realistic. Your sellers have a right to a realistic explanation of your intentions with their property. If you plan to wholesale the property, tell them; if they are asking too much money, tell them; if their time frame doesn’t work for closing, tell them. You want them to be honest with you about their property, and they deserve for you to be honest with them about what you plan to do with it. If you bend the truth, or aren’t up front with everything, you’ll look like you’re incompetent, or worse, an untrustworthy partner.

The main thing to remember when getting involved in real estate investing is to keep what’s important in front of you. Have a plan in mind, be realistic, and have an exit strategy. Consistently market yourself and know what kind of market is involved. It’s an exciting venture to be a part of, so learn as much as you can and enjoy the ride!