Property Investment Advice

How to Get Started in Real Estate Investing?

If you are already a real estate investor, you may have picked up some useful ideas that will make your future investments even more profitable. Perhaps some new avenues have been opened up in the type of property or financing that is available to you.

If, on the other hand, you are a would-be investor who is venturing into real estate investing for the first time, your first question may very well be "How do I get started?"

Here are some simple tips and property investment advice to get you started in real estate investing.

1) Know Why You Need to Invest in Real Estate

Establish in your mind the need for investing in real estate in order to stay ahead of taxes and inflation. Remember, 95% of the retired-age people in the United States end up practically broke because they failed to realize the importance of investing the bulk of their retirement funds in real estateand other non-fixed investments. Never forget that your primary purpose of investing is to create a life-long estate for yourself and your loved ones.

2) Establish Your Financial Goals

Prepare a current financial statement so you know exactly where you stand today. Prepare a long-range financial statement estimating major expenditures you know you will face in the future. And determine how much money you think you will need to maintain your present standard of living after you retire.

3) Locate Sources of Investment Capital

Consider such sources of start-up capital sa savings accounts, cash value life insurance, borrowing against stocks and refinancing of other real estate. Enlarge your investment holdings as your capital increases. Keep in mind that real estate is not a one-time investment. Just because you own one building does not mean you cannot own more.

If you're in the stock market, you probably don't own stock in just one corporation-you diversify. The same holds true in real estate. As your equity builds up, you may want to spread your investments out over several properties. You will be surprised how fast your equity will build in real estate.

4) Select the Type of Investment that is Right For You

Consider the various types of real estate investments that may be available to you and right for your particular situation. Single family homes are perhaps the least expensive way to start. On the other hand, an office or store building may offer particular advantages that make such an investment the best one possible for you.

Consider a small rental apartment building if you are a beginning investor and this is your first real estate investment. This type of investment is the easiest to understand,. and you will generallyhave a large selection from which to choos.

5) Locate Your Investment Property

Give serious consideration to working with a knowledgeable investment realtor if this is your first venture. The advantages that you gain will make it well worth your while. He probably has properties available that you would never locate on your own. While working with him, learn as much as you can. Do not rush into the purchase of a property that you are not convinced is a good one. Take your time.

6) Analyze Your Prospective Investment

Analyze your investment carefully and thoroughly after locating it. Verify all details, especially the income and expenses the seller shows. Develope a property analysis form you feel comfortable using. It will also serve as a reminder for items you want to know, such as type of units, age of the property, rent breakdown per unit, expense items, lot size, etc.

Never make a decision based on the "aesthetic beauty" of the building or by using a simple rle of thumb to determineits value. Take the time to prepare a property analysis. This is the only reasonably certain way of making the right investment decision. If your property analysis shows that the property does not make financial senses forget how "pretty" it may be. Don't buy it.

7) Use the Financing Technique that Gives You the Best Results

Use various financing techniques to alter the terms under which you may want to purchase the property. Try various alternatives to see which one gives the best results from your investment viewpoint. Many real estate transactions can be made or broken by the use of creative financing of the lack of it. Use financing to your advantage.

8) Consider the Tax Consequences

Analyze your investment from a tax viewpoint. Remember that it does not matter how much you make but how much you get to keep after taxes that is important. Do not try to do it alone. Use a knowledgeable real estate tax accountant to make recommendations.

9) Monitor Your Investment with Return In Mind

Don't fall in love with your property. That could be the start of failing to realize your investent goals. Unlike your home, your real estate investment is nothing more than a "money-making machine" When it no longer does what it is expected to do, get rid of it and buy another.

10) Consider Leasing Space to Yourself

Consider purchasing you own office building and leasing it back to your professional corporation if you are a professional businessman, attorney, physician, dentist, realtor, etc. Tremendous tax advantages may be available to you as a result.

11) Secure Your Financial Future

Plan on pyramiding your real estate investments to build your estate. Do not go into real estate investing expecting to become a millionaire in twelve months. Your goal is to acquire sound investment and let appreciation take over. Your primary purpose of investing is to secure your financial future.

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