When we think about starting a business or making a financial investment, the ultimate goal is usually the same: getting enough money to allow us to live the lifestyle we want.
And when you think about the amount of money you have to raise to allow yourself to do that, do not forget to consider inflation + taxes that have to be paid and that will automatically have to be deducted from the total amount of money you have.
And when it comes to investments, having a property or several real estate is always a good idea; even in periods of financial crisis.
Think so: land is a finite resource. People will always need spaces specially designed to live, work and have fun. So, just like in other areas of business, so is in the real estate: everything is just a game between demand and supply.
What is good to understand is that: real estate properties will continue to experience an increase in their value as time passes, despite slowing down periodically as a result of more subtle or larger economic crises.
Real estate is the field that brought most people from simple people to millionaires. And in spite of what you might think … no, you do not have to be a genius to succeed!
So, if you’re thinking about investing in real estate, to gain your financial independence, here’s what you need to know:
1. Set your financial goals
What are your goals from a financial point of view?
What are you expecting from buying a real estate?
What you achieve by acquiring that property will bring you closer to achieving your financial goals?
As you well know, developing a business requires time and money. Investing in real estate is no exception to this rule.
So, if you have an already tight amount of money that you want to invest in this direction, make sure you take all the time to identify a property that matches your budget and not just so … a property which, once purchased, will serve your interests better and will make it easier and faster for you to accomplish your goals.
2. Do not spend a fortune on books and courses
You do not have to misunderstand. You need to have some knowledge about real estate because, from this adventure you start, you get to be a winner. But what you must know is that all the information you need should get maximum a shelf on your library as a volume.
So bend over the books and study carefully. Search on Google and make a habit of reading real estate sites.
But do not overwhelm yourself with the existing information around you. When you notice that you read, read, and the things you already know continue to repeat, with 1-2 relatively new elements in addition, it means you have learned about everything you need to know.
It is very easy to let go of the thought that you still have not found the trick you need to quickly get rich out of real estate and continue to document, collect books and courses in the hope that you will find that secret information that will open the gate of wealth in real estate for you.
So, when you notice that the information you read is still repeating, it means that it is the perfect time to stop reading and return to real life. It’s time to move to point 3.
3. Visit several real estate properties
Life beats the movie. And what else can make you feel the pulse of real estate in your area, than … some direct visits on the field.
But great attention! Do not buy the first property you see.
Here are two mistakes that many real estate investors do:
– Buy a property for the simple fact that they like what it looks like
– Buy the property because they are not willing to make the effort to inspect other properties existing on the market at that time
Remember: you must look at that property from the perspective of return on investment. You will not live there. You do not have to like it. Instead, it must be profitable when you decide to sell or rent it.
Once you’ve visited enough real estates, take a moment to think and put on paper the most tempting real estates you’ve visited. Write along with them your financial goals. Then try to reduce the number of listed properties from the perspective of the goals you want to achieve.
This exercise will help you make the most beneficial choice for you.
4. Do not expect the miracle offer
By viewing real estates again and again, you can fall into the other side: to postpone the decision to purchase. And as you may well guess … this action will have negative repercussions.
Not buying a real estate under the pretext that you have not found the “winning offer”, you might lose more than if you found an offer not as tempting as you would like, but you have bought it to put it to work, to produce money for you.
To conclude: as soon as you find the real estate offer that meets most of your criteria, stop thinking and buy it. Continuing to wait for the “irresistible offer” you dream of is a dangerous game … this offer may never be, and the offers that pass next to you may not come any more soon.
5. Make a thorough financial analysis
Let the figures speak. Look at all like a game of numbers. Just so, the conclusion you get will be realistic.
If you think about the whole transaction from the financial perspective and leave your feelings aside, it will be easier for you to refuse a property when the terms and conditions of the transaction do not meet your profitability criteria.
In this sense, take the time to make a complete analysis of the property based on its history. Also, inform yourself about the distance to the city’s main points of interest.
See how much you can rent or sell the property according to the potential of the area.
Take into account the taxes that must be paid and the interest you have to pay to the bank, if you make a loan to that effect.
And finally, draw the line, and see how profitable your real estate investment will be.
6. Find sellers anxious to close the deal
How can you do that? When you find a real estate that you like, be interested in it’s history. Since when is it put up for sale? How has it’s price changed since it’s on sale to date?
If the price of the apartment or house in question is unchanged although the property in question is on sale for more than a year, you can see that its owner has it’s price and is not willing to give it less than what he ask for; in other words: negotiating with him will not end with far greater benefits for you.
But if you find a property whose price has continued to decline over the last year, it means that its owner is anxious to get rid of it. As a result, that person will be more flexible in negotiating with you, and you are likely to have the chance to win and get the price and conditions you want.
Owning one or more real estate properties can provide you with the financial stability you want. It can also be packed with those passive income that everybody wants, if you rent it.
It’s all about staying calm, not making hasty decisions, and logically judging, based on figures. Real estate businesses are long-term businesses. Also, it’s important to realize that buying the desired property is just the first step you take to reach your financial goals and not the end of the road. Success!
Please follow and like us: