One way to become wealthy is by investing in real estate.
That’s a saying we all have heard by now but is it true? Many people have become wealthy by mastering a strategy of buying an investment home, but you can also lose money quickly if it’s not done correctly.
“Ninety per cent of all millionaires become so through owning real estate” ~ Andrew Carnegie
So you’re thinking about buying your first investment home but don’t know where to start. Here are a couple of tips if you’re not already in a wealthy position:
Before you start investing in real estate, it is imperative that you get educated in the important concepts.
[tagline_box backgroundcolor=”” shadow=”no” shadowopacity=”0.1″ border=”1px” bordercolor=”” highlightposition=”top” content_alignment=”center” link=”” linktarget=”_self” modal=”” button_size=”” button_shape=”” button_type=”” buttoncolor=”” button=”” title=”FAQ” description=”Can I invest in Real Estate if I have a full time job?” margin_top=”” margin_bottom=”” animation_type=”0″ animation_direction=”down” animation_speed=”0.1″ animation_offset=”” class=”” id=””]Yes. There are multiple of ways to make money in real estate and every strategy has its own unique benefits and drawbacks.[/tagline_box]
1 Start small
Buying a home that’s around $150,000 is probably a good start. A small mortgage payment is what you need to make a profit.
Buying an investment home most times requires a larger down-payment so having a lower mortgage will allow you to pay it off quickly and give you a higher monthly profit.
2 Keep some money aside for a rainy day
You never know when the microwave will malfunction, the boiler stops working, or the dishwasher springs a leak, and you need to replace the flooring.
The cost of hiring a professional to fix it if you’re not a handyman may be enough to cut into your profit for the month if not a few more. Budgeting for factors you cannot control will at least give you piece of mind in knowing you’re not owing money out of your pocket. Prepare yourself for the unknown.
3 Setting harder rules in the beginning
This philosophy may save you a lot of energy and money in the long run.
No smoking and no pets are now very common in rental advertisements; you might want to ask yourself why. If you’re not careful enough when you’re interviewing potential tenants, you’ll end with more than just a headache.
Cigarette holes in the carpet, fines for noise complaints and illegal grow-ops are just a couple of the horror stories you hear from landlords. Screen your tenants thoroughly and check references to avoid turning your early retirement dream into a money pit instead.
4 Research the investment home area
You’re buying the investment home in and make sure it’s up and coming instead of heading for a downfall.
You want to be sure the neighbourhood is booming with families, jobs, good schools, business people, and excellent transit to make sure you won’t get stuck with a property that decreases in value and forces you to sell.
5 lastly factor in financial changes
Higher mortgage rates, a rise in the property taxes or only a particular levee can make or break your ability to keep your investment home.
When purchased wisely, investment houses are fantastic opportunities for high profits! Once you have established what works for you and have chosen a suitable tenant, you can sit back and relax knowing that mortgage will soon be paid off. Once you retire, you’ll still have an income every month.
Many investors start by owning one home and slowly purchase more. Owning households in the same neighbourhood is also easier for when you decide to stop by and check on your tenant. Are you looking for an investment property to start you off?
Ready to become a real estate investor?
Contact me today to get started on your early retirement plan and let’s start shopping for that perfect home!
[person name=”Nuvola Capitanio” title=”Professional Realtor” picture=”http://nuvolacapitanio.com/wp-content/uploads/2015/10/nuvola-capitanio-langley-real-estate-realtor-214×300.png” pic_link=”http://nuvolacapitanio.com/contact-us/” linktarget=”_self” pic_style=”none” hover_type=”none” background_color=”” content_alignment=”” icon_position=”” pic_style_color=”” pic_bordersize=”” pic_bordercolor=”” pic_borderradius=”” social_icon_boxed=”yes” social_icon_boxed_radius=”4px” social_icon_color_type=”” social_icon_colors=”” social_icon_boxed_colors=”” social_icon_tooltip=”” email=”Nuvola@NuvolaCapitanio.com” facebook=”https://www.facebook.com/Nuvola-Capitanio-Real-Estate-1028833650519102/?fref=ts” twitter=”” instagram=”https://www.instagram.com/nuvolabc/” dribbble=”” google=”” linkedin=”https://ca.linkedin.com/in/nuvola-capitanio-973851123″ blogger=”” tumblr=”” reddit=”” yahoo=”” deviantart=”” vimeo=”” youtube=”” rss=”” pinterest=”” digg=”” flickr=”” forrst=”” myspace=”” skype=”” paypal=”” dropbox=”” soundcloud=”” vk=”” xing=”” show_custom=”no” class=”” id=””]Nuvola sells hundreds of homes all over the Lower Mainland Call: 1.604.721.5805 [/person]