Is your resolution for 2013 to become a real estate investor? If it is, you’re choosing to do so at the perfect time. The market is perfect right now for first time investors, and if you’re serious about it you can make a ton of money. But real estate investing isn’t something that you can just do without any prior knowledge, as it takes a ton of skill, research, and dedication to become a successful real estate investor. If you’ve got tons of flyers from homes you’re considering in investing in, slow down a little! The upsides are high, but so are the downsides. If you’re planning on investing in real estate this year, check out these tips to get a good understanding of how to be a successful real estate investor.
If you want to become a successful real estate investor, you need to specialize in certain markets in the beginning. While the key to becoming a successful investor in just about anything is diversification, you need to spend all your time and resources on a certain segment before you can reach this status. Focus on fixer-uppers, foreclosures, starters, or another segment, but don’t try and do it all. Diversification will come in time, but in the beginning you need to become successful in a single category before you can start mastering the others. Trying to do too much will be too much of a load on you, and you likely won’t have success in the real estate investing market.
One of the most common mistakes that first time investors make is not thoroughly inspecting the property that they’re investing in. This is bad for a number of reasons, and can lead to huge losses and ending up in the red. Make sure you at the very least do a walkthrough of the property you’re planning to invest in. If time and finances permit, you should have outside inspectors come through to make sure everything is sound. The worst thing that could happen would be to invest in a house, only to find out it has severe structural damage, meaning you must put in tons of money in order to sell it. This will end up in huge losses, so make sure you inspect every property that you plan on investing in.
You can read all the financial statistics and reports you want, but the only true way to determine if a property you’re considering investing in will succeed is if you do the research and compare it to comparative properties around it. Look on websites like Zillow that allow you to compare property values and what local properties are selling for, so you can see if what you’re considering investing in is a good choice.
When you’re just starting out investing, it’s important that you stay local. That way you won’t be spending extra money on travelling to view properties or address issues with faraway properties you’ve invested in. Once you become successful you might find that you can make more money investing in properties that aren’t local, but in the begin you should stick with what’s in driving distance.
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