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Tips On Real Estate Investment |
There is no magic formula ready made for success in real estate investment. It might sound pessimistic but it’s true and pragmatic. The tricks of the trade can only be picked while working in the industry through trial and error. As there is always an unpredictability of the nature of demand and the swing of trend.
However, a few basics can be laid out to help the beginner to avoid some fatal mistakes in the investment in real estate.
Equal Opportunity: There is no large conspiracy in this industry to keep somebody at bay. Investing in real estate is not just for the hi-fi rich people. It is open for every decently well off person. Of course, you need money to make money, but you’d be surprised how little capital you actually need, with fractional ownership growing in popularity it’s even easier for the small investor.
Research before Buying: Considerable amount of research and homework helps in buying the right property at the right time. Many investors have bought developers nightmare properties and made millions out of it. Don’t be fooled by the “Pre-construction” or “Phase One” hype. If a development is a bad investment it doesn’t pay how early you buy it.
Trustworthy Brokerage: It’s important to locate a trustworthy agent. Many agents have deals with developers that more they sell off that project, the higher commission they get from it. So if they convince you to buy their “premiere” property they can receive anywhere from 2-8% more per sale even though the sales price is the same.
Blind Following: It does not make sense to buy property only because a friend of yours made a lot of money from it and you want to do the same. This is not always the smartest move; the people who buy early are the ones making the bulk of the profit from a development. If you try buying into the same real estate project 20 months after your friend made a good profit out of it, chances are you missed your big opportunity. There are many other developments opening up out there that are great investments.
First not always best: A classic mistake people often repeat is buying the first development they see or hear of. Simply because it is the first real estate market investment project you, doesn’t necessarily make it the best.
We should remember that buying a new real estate property isn’t like buying a new car. It doesn’t lose it’s value in a few years, in fact, in some locations real estate usually skyrockets in value in just a few months.
Phil LaBoon is a well known author who writes articles on finance and investment, real estate, etc. for www.investrealestate101.com
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