If you want to get started investing in real estate, you need to find a property, acquire funding, and then decide whether you want to flip or hold that property.
Want to get started investing in real estate? There are three key steps you need to take.
First, though, you need to analyze what your investing goals are. Are you unhappy with your stock market returns and looking for a better investment? Are you looking to build wealth or build a portfolio? There are a lot of reasons someone might invest in real estate, so you need to sit down with someone who’s an expert on real estate investing and make a plan. Once you have a plan, then you can embark on these three key steps:
1. Find a property. How do you find property? Where do you find property? At the end of the day, no matter what books you read, they’ll always tell you that your real estate partner, your attorney, and your CPA are all key in helping you during this step. Your real estate partner will be your resource for your property, so it’s imperative that you work with a real estate agent who knows what they’re doing and has experience investing in real estate. When you interview an agent, it’s a good idea to ask them what their level of experience is over time.
“It’s imperative that you work with a real estate agent who knows what they’re doing and has experience investing in real estate.”
There are a ton of different resources you can use to find a property. For example, you can go online and search the MLS, or you can search off-market properties. In any case, the most important thing I tell people before they jump feet-first into real estate investing is to know their criteria. What do you want to buy? What do you want out of your investment?
2. Acquire funding. After you find a property you’re interested in, you need to fund its purchase, and there are a variety of ways you can do this. If you have equity in your primary residence, you can do a home equity line of credit. You can also use hard money, private money, or your own money. Or, you can go to your bank and take out an investment property mortgage loan. It all depends on your plan. If you find the right deal, funding will come no matter what.
3. Flip and/or hold the property. Once you have your property, are you going to flip it or hold it? Knowing this will help you determine what kind of renovations you’ll make and how much money you’ll need to make those renovations.
Keep in mind that investing in real estate does come with a certain amount of risk. It requires a lot of time and money and there are a lot of moving parts involved in the process. Working with a professional such as myself can streamline this process and help get you through your first transaction with minimal hassle.
As always, if you’d like to talk more about this topic or you have any questions at all, don’t hesitate to call or email me. I’d love to talk to you.