Real estate is a never ending game of moving from one purchase to the next, but it’s always important to treat each investment as different from the last. It’s also important to keep learning. There’s never going to be a time when you can simply follow one set of rules without question and have every investment turn into a profitable one. Different actions will be required for different situations.
If you’re thinking about making your next real estate investment—or even your first one—here are a few guidelines to help you do the right thing with your money.
Define Your Budget
The first and most important step is calculating—and sticking to—your financial resources. Always think carefully about just how much you are willing to spend on an investment, and make sure you factor in everything you’ll need. Purchasing a property often isn’t the only expense, and you’ll need to consider other things like repairs and renovations, as well as long-term considerations like utilities if you’re planning to rent the property out.
Define Your Needs
Just wanting to invest in real estate isn’t enough; you need to have a clear plan for why you want to invest and what you plan to get out of it. Deciding to purchase and manage a multi-family residence, such as an apartment dwelling, is going to have different considerations from buying a residence to renovate and flip. If you’re considering being a landlord for the first time, you’ll also need to consider things like tenant’s rights and apartment owners insurance.
You’ll also need to look at your own preferences, such as whether you’re set on investing only locally, or are willing to entertain promising investments that are out of state. What your goals are, and where you set your preferences and limits will go a long way towards crystallizing your strategy, and narrowing down your options.
Do Preliminary Online Research
When you’ve got some promising properties, the first thing you should do is use the Internet to get as much information as possible. Applications like Google Maps and Google Earth are especially useful for getting a quick survey of the neighborhood. This is especially important for possible rental properties; you don’t’ want to find a property a bargain price, only to realize it’s in a neighborhood nobody wants to live in because it looks like a war zone.
Online research can save you a lot of trouble in getting good, general information about properties of interest. In many cases, this can help to save time and eliminate obvious bad choices, since so much critical, general information about properties and surrounding areas are easily researchable.
Visit the Properties
This should go without saying, but some people, feeling the pressure of a supposedly good deal that might slip through their fingers are often tempted to ignore this. Nothing beats an actual visit to a potential investment, especially if you, or someone you bring along, can make a thorough inspection of the place and see what condition it’s in.
While you can get a lot of general information about a place online, only a visit can truly show you what a property is all about. Make sure you conduct a careful examination and take note of the condition of the infrastructure for considerations like plumbing, electrical, and other aspects of the building that may need repair or modernizing.
Once you’re ready to commit, you need to think about insurance coverage, but we can help with that. Contact us with your questions, and we can put you on the right track. Contact us today for more details at 800.644.6443.
