As I mentioned, there is risk involved. Any investment that can make money for you can also lose money. That’ s a fact of life, but there are ways to tip the balance sharply in your favor. You can protect yourself by ensuring that contracts are written to your advantage, by paying attention to both what is in a contract, and also what’ s not. It is imperative that you read and understand everything that is contained in the contract, including all clauses, and also foresee any contingencies that are not mentioned. You may even choose to have a real estate attorney to help you review property contracts to be sure that there are no“ gotchas.”
Now, I promised that I would provide you with stepbystep instructions to Invest for Success. This is a quick thumbnail sketch of the 7 steps involved in the process and important points to know. You’ ll tailor a plan for yourself, but this will give you a good start.
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Develop a simple plan. Keep your real estate portfolios local and plan to focus on single family homes at the beginning.
Learn your market. We touched on this earlier because it’ s important to know prevailing costs per square foot, develop the capability to assess quality, and have a good working knowledge of which amenities are desired in your area. That will give you the ability to spot bargains. Using a mentor who has succeeded in real estate investing can help you fasttrack this process.
Invest for Success
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Think like a businessperson. Like any business, you will want to buy at wholesale and sell at retail. You’ ll make businesslike assessments of each property to determine whether it should be held for rental income or sold for resale profit.