Thanks to real estate investing, I no longer have to work full-time. If I want to go hiking in the mountains with my dog in the middle of the day, I can. If my husband and I want to pop up to Whistler to ski, we do it mid-week to avoid the crowds.
That’s now. But when we were just starting out as real estate investors, we had some serious missteps. We were fined in court for fire code violations, a property manager stole rent money, we got unwanted publicity in a newspaper as “absentee owners of local crackhouse,” and we lost money on a property in one of the hottest housing markets in history.
We made some horrible mistakes – but 90 percent of them were completely preventable had we followed the advice I’m going to give you today: Know where you want to go before you start.
Ask yourself:
• Is it more important to you to find a property that doesn’t cost you money or one that doesn’t cost you time?
• Do you want to make repairs?
• Are you interested in investing for the long term or the short term?
• What is your risk tolerance?
• Do you want real estate to be your primary source of income?
• How much money can you (do you want to) dedicate to real estate versus other investments?
• What’s your current credit score?
• What’s your current financial situation?
Being clear on what you want to put in and what you expect to get out of your investments is the first step. It gives you clarity on your next steps. It also helps you avoid the reckless mistakes we made. Had we set realistic goals and taken steps toward those goals, we never would have purchased the properties that led to all the drama we experienced as newbie investors.
[Ed. Note: For more insider strategies for getting started as a real estate investor, sign up for real estate expert Julie Broad's free monthly newsletter. Get your free report for making money with real estate here.
Real estate is a great way to make money - even in this economy. But it's just one of many strategies you can use to reel in big profits. Learn how to get your hands on over $17.3 million in moneymaking ideas right here.]
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Clarity is definitely important. Have made the mistake of not having it on a purchase that was to be a buy and hold ‘forever’. Life changes make our goals change and with that exit strategy also changed. Clarity of alternate scenarios would have given us more options. I will know better next time. Thanks for another great article Julie.