Real estate has the potential of huge payoffs on your investments; however, not everyone is guaranteed to automatically realize this potential windfall because of some misconceptions.
Investing in real estate properties is not a get rich quick system because just like any other types of investment, you have to keep up to date with the latest trends and developments, keep getting leads and contracts and keep putting time and effort into it to protect your investment.
To engage in the real estate business, you have to identify the exact area you want to work in.
Keep focused and channel your efforts in one or two areas only in order not to spread your resources too thin.
Do you want to purchase properties and engage in Buy, Renovate and Sell? Do you want to buy properties and sell them right away? Do you to lease properties to potential buyers with an option to purchase at a later date?
All these should be given careful consideration depending on your financial position, location and other resources.
Once you have established your exact investment preference, writ down your plans.
Set goals for 3, 5 and 10 year periods and write down your goals in terms of your cash position, equity and property holdings as you want them to be.
From here, break down your goals into manageable chunks of quarterly and semi-annual mini-goals to make it easier to achieve your long term goals. Keep in mind that these plans are fluid and subject to change according to varying market and financial conditions.
Do not resign from your job right away, stay with it for as long as possible to relieve yourself of the pressure and frustration of jumping head first into the real estate investment market.
Before finally quitting your job, secure low- to no-interest credit cards (using your employment as proof of stable income). When you finally engage in real estate, you never know when it may come in handy to cover a $12,000 bill for your renovation and repair projects.
You don?t want to use up your cash reserves early on in the ball game.
Make sure you retain the services of a good real estate lawyer. Nothing beats having somebody knowledgeable about the several creative options of real estate investment.
Your lawyer can ensure that all negotiations and transaction go smoothly to save you time and money. Your lawyer should be able to assist you in almost all phases of real estate acquisition and sales.
Before you decide to engage full-time in real estate investing, build up your list of potential buyers. Ask real estate brokers how they go about doing what they do, and learn from them. Most people love to talk about their successes, just be sure to ask politely for advice and do not waste their valuable time.
However, be very careful about going into a long-term partnership. If you want, you can go into a limited deal-to-deal partnership while you are still learning the ropes.
As much as possible, set up a separate LLC entity for each deal. It is relatively easy and cheap to set up and you get to keep your personal assets off the insolvency table should something go wrong. Your lawyer is in the best position to give you advice and help you set up your corporate entity.
Finally, set a number of deals you have to work on weekly basis and do your best to close deals in order to realize the goals you have set for your business portfolio.
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