4 Steps to Determine Your Real Estate Investment Strategy

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When starting out as a real estate investor, just selecting the “right” strategy can seem like a daunting process.Where do you invest? What type of property should you buy? Which strategy is right for you?

For many new investors it is tough to know where to start. In this article we’ll go over 4 steps that will help you choose the right investment strategy for you to get started with confidence.

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1. Determine Your Objectives

First you need to be clear on what you want to get out of your investing. Are you looking for something short term or long term? Are you going to focus on cash flow or equity growth? How hands on do you want to be? How much time and effort do you want to put into your investment?

These are all important considerations which should be thought out in advance of your first transaction. Once you get clear on what you’re looking to get out of your investment, you can start to seek out the right strategy.

2. Examine the Big Picture

With your objectives in mind, you can now start to look for the right strategy to meet your goals. Start out by looking at every possible strategy you can find and learning the pros and cons of each. By examining all of the options you’ll know what strategies are available to you and can confidently choose the right one to meet your needs.

3. Filter Your Options

After doing your homework and figuring out all of the strategies available to you, it is time to start filtering your options. Evaluate the pros and cons of each strategy and see how it measures up to your investment objectives. Narrow down the top few strategies that would best meet your objectives.

4. Speak with Experts

For each of your top strategies, find someone who is an expert on that strategy and speak with them. Many veteran real estate investors are happy to share their knowledge with new investors, and hearing all about the pros and cons of their particular strategy will give you unique insight into whether or not it will be a good fit for you.

Spending some time doing your homework will take you from a state of overwhelm to a feeling of confidence as you select the strategy that is best for you on your first deal. Having the ability to move forward with confidence is worth the time you’ll spend doing your homework, and you’ll get some valuable tips from veteran investors along the way that could save you thousands of dollars.

Creative Commons License photo credit: Steven | Alan

About Author

Andrew is a Canadian real estate investor and analyst who works with Joint Venture partners to create long-term wealth. With a focus on buying and holding positive cash flow properties in Canada's Technology Triangle, Andrew makes the benefits of real estate investment available to those who lack the time or expertise to buy and manage property themselves.

11 Comments

  1. Pingback: 4 Steps to Choose Your Investment Strategy

  2. Awesome post. Just like with any goals having clear objectives and aligning your tasks and relationships with these objectives is essential, especially in real estate investment industry. Thanks again for sharing

  3. Goals are important and understanding the market currently and where it may be headed can help you determine a strategy as well. Right now with all the bank-owned properties on the market and rental prices on the rise, buying rental property with a 10 year time horizon is loking like a good way to go.

  4. Speaking with the experts is the best piece of advice that you could have given. My biggest problem is that people will come into the real estate investment market and try to think they have a grasp on things and they don’t have a clue.

    There is nothing wrong with seeking advice from someone and since it can potentially help you in the investment process, you should strongly consider it.

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