Real estate can make you and your family very wealthy, if done correctly. There are many experts that will say the stock market is better, but there are just as many that prefer property. I think the thing about real estate is the fact that we ALL deal with real estate in our daily lives.
You go home to be with your family and have a place to sleep. You go to the building where you work and we ALL go to shopping centres and other businesses.
But the biggest mistake many make is to thing hat it is a free ride when you invest in property. So here are a few rules you can apply to make real estate investment a realistic possibility for you.
Long-term investment
That;’s right, property is a long term investment. you can not get rich, wealthy or financially free over night when you invest in real estate you need patience. you should always focus on building your wealth in real estate over a long periods of time, years in fact. If you do you WILL be financially free one day. The great thing about long-term investments are that short-term fluctuations do not really affect them and you will be able to sleep at night. Be careful of get rich quick schemes. They seldom actually never work.
Cash flow is king – Income vs capital growth
Many investors underestimate the importance of cash flow. Without it you will go bankrupt. For this reason it is a good idea to focus on generating income from your property portfolio, the capital growth is the cherry on top. As long as you can pay the bonds, with the rental income, your property can keep growing and when the bond is paid up you get to keep the income as well as the capital growth.
Slow and easy…
Take your time when looking for that special property. The days of finding bargains at the drop of a hat are over, even when the economy does poorly. You have to keep your eyes open and find those properties that can give you positive cash flow immediately, this is difficult I know, but if you keep looking, you will find them. The other option is to buy really low risk real estate, property that has a minimal shortfall. As long as you can afford to py the shortfall out of your pocket you’ll be fine.
Become the expert.
Choose your property type and learn everything you can. Because people tend to think real estate is too difficult or even risky you can become an expert by getting the right info. Research areas and get growth reports. Many sellers don’t know how to research property so you could potentially get bargains because you have the information.
Use your raise to invest.
If you still have a day job you probably get raises through the year. instead of upgrading your life style buy real estate. In a few years you won’t need to work any more and you will be glad you decided to invest in the future and not instant gratification. This is probably the most difficult thing to do but if you motivate yourself you can and will do it.
So. Go out and start looking for that property, always plan first though…
