Real estate is one of the three time-tested ways for people of varied economic means to build wealth (the others are stocks & small business). Over the long Abdo Romeo -term, you should be able to make an annualized return of at least 8 to 10 percent per year investing in real estate. Before you begin your journey of real estate investments you should pen down your short & long term goals along with the exits. You should also be able to understand the common loans available through lenders & how you may be able to finance your real estate investment through the seller of the property.
Investing in real estate isn’t rocket science but does require doing your homework. If you’re sloppy doing your legwork, you’re more likely to end up with inferior properties or overpaying. Our book clearly explains how to buy the best properties at a fair (or even below-market value!) price. A point to be noted here is that investment in residential properties is more accessible & appropriate for non-experts. So, if you are a starter in the real estate market then you should begin with residential properties such as single-family homes, detached & attached condominiums, small apartments including duplexes, triplexes & multiple-family residential properties and raw (undeveloped) land. Realestate investment trusts (REITs) can also be purchased through stock exchanges or a real estate mutual fund after careful study. Foreclosures & tax sales are another uncommon options to invest in.
Although you should make money over the long-term investing in good real estate properties, you can lose money, especially in the short-term. Don’t unrealistically expect real estate values to increase every year. When you invest in real estate for the long-term, the occasional price declines should be merely bumps on an otherwise fruitful journey.
Once you are able to differentiate between real estate & other investment options, have the money that is to be invested in properties and have understood the tax advantages then you should look out to find properties which fit with your overall financial & personal plans. You should not hesitate in seeking help from professionals such as top agents, lawyers & other real estate pros in the negotiation process, plus all the ins & outs of purchase agreements, inspections & closing on your purchase.
Finding and evaluating a property, place or location is another aspect to look into before a buying decision and some of the points to be considered here are population & job growth, income levels, supply & demand of properties, Government’s effect on the real estate in that location, schools, crime rates, pride of ownership, real estate cycles and most importantly what attracts you to the property.
If you having a trouble in financing your property purchases then you may look at fixed-rate and adjustable-rate mortgages, borrowing against home equity & seller financing. You should think twice before you opt for mortgages such as balloon loans, interest only loans and recourse financing. Another thing that you may rely upon is real estate referral & web surfing for mortgages. You should not just blindly trust upon the advices of mortgage brokers.