We have all heard of people who have amassed great wealth by owning investment real estate. Considering the anemic returns banks are paying out, many Americans are grabbing up investment properties as their best path to financial freedom and future security.
Of course, any investment carries an element of risk and to minimize your risk you should seek the advice of qualified advisors, do your market research, and set your long term goals.
As you set your goals you will have some important things to consider:
Do I prefer a residential rental, apartment or commercial building?
Am I more focused on monthly cash flow or potential appreciation?
How long do I plan to own the property?
Do I plan to hire a property manager vs handling it myself?
Do I want a long term tenant or short term vacation renters?
Am I willing to take on a property that requires repair and renovation?
Across the country there are pocket markets with extremely affordable investment opportunities, however these opportunities may not offer high appreciation and may make it more difficult to keep your eyes on your investment. Many savvy investors believe that if you can’t drive to it you shouldn’t do it.
Many first time investors find it much more comfortable to purchase a small and affordable fixer upper in their own neighborhood and save money by maintaining and managing it themselves. These types of investors may be more likely to be in it for the long haul, setting a goal to pay off the property and have a future stream of monthly income from the rent.
Flipping is another investment strategy that we have all seen on TV and while it can be profitable to buy an ugly home at a bargain price and then fix and flip it for quick profit you have to be careful. Often the time to sell the property takes longer than expected, costs more than the original estimate, and can be a stressful process.
As you begin to develop your own real estate investment plan you will want to start by talking to an experienced real estate agent who can start you down the right path and answer some of the questions you may have, and guide you to self-discover the type of investment situation that best suits your long term goals. I would be happy to offer a complimentary, no strings attached, consultation.
I would be happy to provide you with market statistics and trends, rental rates, and link you to receive property alerts and information on the types of properties you are interested in. If you are looking outside of the area, I have access to elite agents across North America. You can contact me at any time by reaching out to the number on this newsletter.