Thinking about putting some savings into an investment property?
A lot of questions may be swimming around your head right now.
Real estate investing is a great way to add cash flow and wealth.
This article will help kick off the brain storming to the important questions any new investor may have.
Long term goal setting is a great first step to take. You have a blank canvas and are able to envision how you want your portfolio to look 10 or even 25 years from now.
Choose a main focus. Is your properties main goal long term cash flow?
Are you looking to purchase properties at a low cost, improve them to raise rents, then resell?
Or, are you hoping to purchase properties in core areas to appreciate over time?
Setting your long term goals is your compass when seeking out real estate investments. When looking at a potential listing cut, it is a great way to understanding how each property can add value and is something you should always fall back on and check in with – does the property make sense for you and your goals?
Type of Property
Student rentals, long term multi-family, big ticket apartment buildings or short term Airbnb’s? There are a ton of options to choose from for the type of real estate investment.
The type of property you are hunting should play into your personal strengths. If you are comfortable dealing with a high volume of turn-around, short term rentals may be what you are after. If you can stomach the housing of first time renters, student rentals should be no problem.
You are not bound to one type of property, but setting goals that tie into a common theme can help when acquiring a high number of properties over time. You begin to establish systems and practises in place which only get better with reps.
An important lesson I learned early is to pick a great location you plan on investing in for some time. It is a huge pain to have multiple properties spread out in different locations.
Convenience to where you reside is not necessarily an issue with the proper management in place. However, establishing a team in a specific location takes time, and to do that in multiple locations with only one property in each area may be costly to your cash flow.
Finding the right management company is a daunting task. They can make or break the success of your portfolio. When interviewing management company, ask for references. Check in with current landlords who use them.
Establish from the beginning what their role will be and they type of management you are looking for.
If you are managing the property yourself, then establishing a team of maintenance, plumbers or electricians you can call on in short notice will be important.
The mere fact you are reading articles like this one is a great start. Knowledge is power in real estate. This article should have set your targets on the importance of goal setting, what type of portfolio you are going for, the importance of location when buying multiple properties, and how crucial management is for long term success.
If you have specific questions let our team know! We would love to help.