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Innovative Ways to Get Started in Real Estate Investment |
| Have you always wanted to get into real estate investment, but just do not know the best way to start? The answers to your real estate investment questions will be revealed within this news article. RealEstate Buzz has searched all over the Internet to find the best advice for how to break into the real estate investment market and be profitable. Read more to see some of the best tips we found online! |
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The rest of this article is quoted directly from www.realtytimes.com, as written by M. Anthony Carr. We at RealEstate Buzz enjoyed this article so much that we had to post a copy of it here on our website so that our visitors could benefit from their expert advice on real estate investment:
Buying Houses Just One Way To Invest In Real Estate
by M. Anthony Carr
"Most correspondence I receive inquiring about how to start investing in real estate start with the foreclosure. It's quite simply the easiest real estate investment strategy to figure -- buy low, sell high or buy low, rent high.
Everyone generally understands that as a real estate investor, the concept is to let someone else's rent payments pay for your mortgage and to hopefully come out with a positive cash flow at the end of the month.
There are plenty of ways to get started in real estate investing, and here are some one-line descriptions of how to do it and with the pros and cons listed.
Foreclosures
How it works: Purchase the property at a courthouse auction -- hopefully for less than it's worth. Fix it up, sell it or rent it out.
Pros: This is a common sense approach to getting started in real estate investing. If you can get the property for a wholesale price and then rent it out for less than your mortgage, you're on your way to building wealth one month at a time.
Cons: You get into the property and find out it has major problems costing a lot more than you'll ever recover. Ever heard of concrete being flushed down the drain (usually out of spite from the former owner)? It means having to remove all the sewage drains. Hidden defects can run costs up and give you a red ink bath before it's done. Since the bank/note holder is selling the property as is, there's not much recourse.
Fixer-Upper
How it works: Purchase a property that needs major repairs. This is not a property that just needs paint and carpet. This type of property usually has rot, flooring, roofing, basement and just overall problems. But that's what makes it so enticing.
Pros: For investors with their repair ducks lined up in a row, this can be a good money maker. The key here is to hammer on the seller early in the negotiating process. Get the house for as low as possible and know what your bottom line really is.
Cons: For those wanting to flip the property, if you can't make $30,000 -- $50,000 on the projected profit, then you may want to pass. Why? An unseen defect can run into the tens of thousands of dollars really quickly.
Retail Investment
How it works: Keep your eye open for under-priced properties in an area where rentals are brisk. This would be a house that really does just need paint and new carpet. Be sure you know what the rents are before going into the property. You want a positive cash flow before you even walk into the property.
Pros: A house that is in good shape can rent for years without any major expenses if it was taken care of early on.
Cons: Good rental properties (say, in a college town or near a military base) don't come on the market often, so you could be waiting a while before you find one. (Experienced investors usually scoop these up before the novices even know it's on the market.)" |
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