Real Estate Investment Strategies: Know What You Want

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When it comes to real estate investing, I think it is really important to know what you want.  There are numerous articles (including mine) that talk about the importance of knowing why you want what you want and I still believe that’s a key first step.  However, along with your “why” must be your “what”.

Here’s what I mean.

My husband and I are very keen on debt free investing, which isn’t exactly a popular concept.  Everything we’re doing with real estate outside of  buying & holding properties is only done so that we can pay down (and pay off) our rentals.  Does this mean we’ll have fewer properties? Yes, and that’s ok!

We’re also keen on not having to constantly buy more properties and generate additional activity — we have an exit strategy for our business. We want to acquire our properties, reach our cash flow goals, and then move on within a specific number of years.

Without being clear on these and a couple other “whats” we have, we could easily find ourselves veering off in directions to implement strategies that simply do not align with our desired lifestyle and overall goals.

For example, if we chose to focus all of our energies on building a solid wholesaling business, this would not align with our desire for long term passive (well, mostly passive) cashflow.  If we chose to specialize on lease options in order to get some of the best tenants for our properties, we may end up needing to purchase additional homes every few years as options are exercised.  There are numerous real estate entrepreneurs who are successful with either of these strategies — but that isn’t the point.

So what am I saying here?

Even if you’re just starting out and penniless, know what you want and choose your real estate investing strategies accordingly.  To get you thinking about your “whats”,  consider the following:

  • Length of time you’d like to be involved in real estate business
  • How active you want to be in your real estate business
  • The things about real estate investing that really get you excited
  • Resources needed  and how soon (money, people)
  • Your specific strengths and how those strengths can best be leveraged

You may have more than one strategy, or you may have a plan to start with one strategy for a certain number of months and then move to a second one.  Fine!  Just remember that another great investing niche or strategy will be always be out there to tempt you.  Before considering any new strategies, be sure to double check those “whats” and stand firm.

Photo: joey.ganoza

About Author

Shae Bynes is a real estate investor in Sunny South Florida. On her blog, GoodFaithInvesting.com, she provides helpful tips and an inside look at her real estate investing adventures -- obstacles, failures, & successes!

8 Comments

    • Thanks Liz! You’re so right about the realities of being an investor. In my short 3 years time of being a landlord, I’ve dealt with termites, an air conditioner repair, and eviction. This business, like any other, has its ups and downs and its good to #1 be aware of it and #2 know that your success depends on the way you respond to the downs.
      .-= Shae Bynes´s last blog ..Offer mojo and one crazy day =-.

  1. Shae, great advice, specially for new investors. Too many people get focused on getting more and more deals go through, without much thought to the unnecessary risk to which they are being exposed. Debt-free investment is the way to go, if you can afford it and have the long-term plan to execute it. Great post.

  2. Nice article, Shae! I definitely agree. I think a lot of people who go into real estate go into the mindset of just making “easy money” (like what Liz said) and don’t really have much direction. With all the different real estate investing techniques out there, it can be easy to get lost in all the “hype.”

    I actually agree with your philosophy on debt free investing. Getting caught up in too much debt can be catastrophic in the end. It’s amazing some people I’ve met in the mobile home biz just regular, normal everyday people who live debt free.

    I met one guy who works a normal contractor job. He’s got a mobile home on land (that’s paid off), and every now and then when he gets some money (a couple thousand) he buys a cheap mobile home, moves it to his land, and then rents it out. It’s pure cash flow for him. He told me he’ll be retiring in his early 40s if he keeps it up, he’s got about 4 right now and each one cash flows $500. He’s not even a typical investor, just a normal everyday working guy who just wants a better life for himself and his family.

    He says he just wants enough to be able to enjoy life and to provide for his family. These are the kinds of stories people don’t hear about. Unfortunately, it’s the stories that are so embellished with all the bells and whistles (i.e. I made “x” amount of money overnight investing in real estate with no money and no credit, you can too!) that get all the attention.

    I enjoyed the article, thanks for sharing!

    • Thanks Rachel! You’re absolutely right…there are a LOT of stories just like one. I spoke with one the other day whose house I may be buying. He has 7 others and is living off the cashflow from them. Doesn’t want anything extravagant (although I don’t have a problem with that)…just enjoys simplicity and is able to do it debt free in his retired years.
      .-= Shae Bynes´s last blog ..Offer mojo and one crazy day =-.

  3. I am in full support of debt free investing. Much of the mess we found ourselves in today is due to excessive debt and over leverage.

    Many “gurus” would tell you to leverage as much RE with the min down payment – and the lending instituions have supported this bad behavior. Well enough it enough. Dave Ramsey is the best in teaching people how to follow the right steps to financial freedom. Stay out of debt!

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