Newbie Real Estate Investor Tips Newbie Real Estate Investor Tips

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Newbie Real Estate Investor Tips

Are you looking for some real estate investing tips to start building your real estate empire? Or maybe just to generate a stream of income separate from your day job. Real estate is one of my personal favorite investments. Here are just a few reasons why:

  • Cash flow. Even if you finance your investment property, you’ll still enjoy a positive cash flow (assuming you did your due diligence to make sure the property would be a wise investment). And once your tenants pay down your mortgage, your cash flow sky-rockets.
  • Tax breaks. Even with the new tax plan, there will be plenty of deductions available for investment property owners.
  • Appreciation. In addition to the cash flow and the tax breaks, real estate generally appreciates over the long-term. Of course the exact rates vary heavily between markets and years. So I really consider appreciation to be icing on the cash flow cake.
  • Highly passive income. Once you have good tenants moved in, you’ll just need to handle a few repairs and a lease renewal annually. Or you could hire a property manager to make the income entirely passive.
  • Perfect for real estate professionals. As a real estate pro, you already know your market and have insider information to help you make smart investment decisions. Plus the cash flow will help stabilize your income during your slow season or even through a down market.
  • Asset-building. If you spend your spare time collecting smart rental properties, you’ll be able to build quite a property portfolio over the years. These assets give you options later in life. You will always be able to live rent-free in retirement. You can pass the properties along to your family, or you can liquidate the portfolio to leave behind a strong inheritance or charitable donation.

With all those great reasons to invest in property, here are some tips that will help you along in the process:

1. Procrastination vs Rushing In  -  Stop making excuses out of fear or anxiety - go for it BUT try not to be in a rush and purchase out of impulse.  Both are perfectly normal and entirely understandable. And both urges need to be kept in check if you’re going to find success in real estate investing.

2. Be Financially Ready to Invest  -  Be sure to have an emergency savings account to cover at least 6 months worth of expenses.  Pay down your credit cards and get your credit score up to par.  You also need to be sure that your student loans are under control.

3. Cash Flow is the Focus - Real estate typically appreciates over the long-term. But that’s not why you’re investing in a rental property. You’re investing in a rental property for the income! The appreciation is the icing on the cake. So make sure you select a property with a good monthly cash flow.  You’ll need the rent to cover the principal, interest, taxes, and insurance, of course. But it should also cover your property management expenses, maintenance, and routine repairs. And provide a solid income even after all those costs are paid. 

4.  Location is Key - You already know real estate is all about location. If you can afford something in an up-and-coming neighborhood, go for it! It’s most likely to enjoy greater appreciation than other neighborhoods.  Sometimes these neighborhoods are already saturated and too expensive, so check out the adjacent neighborhoods which will be the ones sought after in the very near future.  Perfect example of a such a neighborhood in Brooklyn would be Ridgewood, Queens which is very close in proximity to Williamsburg.

5. Property Management - Be sure to figure out whether you will be the property manager or you will hire someone to do the work for you.  Either way, you need to have a system in place. For example:  How will you screen potential tenants? How will you collect rent? What will you do if the rent is late? How will you handle repair requests? How will you turn the property between tenants?

6. Always Budget for the Unexpected - You already know to plan for certain maintenance expenses. The roof, appliances, and HVAC systems will all need to be replaced at the end of their useful lives, so you can set aside a certain amount of your rental income for those planned expenses. Everything in life is a gamble to some degree. Real estate is on the safer side of the gamble scale, but it’s still important to mitigate some of the risk. Rather than using all the income produced by your rental property, set some aside in an emergency fund to help with these unexpected-but-inevitable costs.

7.  Stay Organized with a Great Team - You’ll need a way of tracking the financials for your investment property. Many of your ownership expenses will be tax-deductible, so it’s important to track those expenses. And of course you’ll need to track your income. Surrounding yourself with experienced specialists will make your investments more sound and your transactions smoother:  attorneys, tax accountants, property managers, mentors, lenders, maintenance pros, etc.

8. Persistance is key - “Be persistent” is just good life advice! And it makes our list of real estate investing tips because it pertains to every aspect of income property ownership. Finding the right investment property isn’t easy. You need persistence to sift through hundreds of options and choose the best fit. Selecting good tenants also takes persistence. As does working with vendors on maintenance and repairs. Whatever stage you’re at in your investor journey, keep at it! Your persistence will pay off.

                                 

   Follow us on Facebook and Instagram!
&
Subscribe to our YouTube Channel!
Revival Property Group
"Real Estate Solutions At Your Convenience"

Are you looking for some real estate investing tips to start building your real estate empire? Or maybe just to generate a stream of income separate from your day job. Real estate is one of my personal favorite investments. Here are just a few reasons why:

  • Cash flow. Even if you finance your investment property, you’ll still enjoy a positive cash flow (assuming you did your due diligence to make sure the property would be a wise investment). And once your tenants pay down your mortgage, your cash flow sky-rockets.
  • Tax breaks. Even with the new tax plan, there will be plenty of deductions available for investment property owners.
  • Appreciation. In addition to the cash flow and the tax breaks, real estate generally appreciates over the long-term. Of course the exact rates vary heavily between markets and years. So I really consider appreciation to be icing on the cash flow cake.
  • Highly passive income. Once you have good tenants moved in, you’ll just need to handle a few repairs and a lease renewal annually. Or you could hire a property manager to make the income entirely passive.
  • Perfect for real estate professionals. As a real estate pro, you already know your market and have insider information to help you make smart investment decisions. Plus the cash flow will help stabilize your income during your slow season or even through a down market.
  • Asset-building. If you spend your spare time collecting smart rental properties, you’ll be able to build quite a property portfolio over the years. These assets give you options later in life. You will always be able to live rent-free in retirement. You can pass the properties along to your family, or you can liquidate the portfolio to leave behind a strong inheritance or charitable donation.

With all those great reasons to invest in property, here are some tips that will help you along in the process:

1. Procrastination vs Rushing In  -  Stop making excuses out of fear or anxiety - go for it BUT try not to be in a rush and purchase out of impulse.  Both are perfectly normal and entirely understandable. And both urges need to be kept in check if you’re going to find success in real estate investing.

2. Be Financially Ready to Invest  -  Be sure to have an emergency savings account to cover at least 6 months worth of expenses.  Pay down your credit cards and get your credit score up to par.  You also need to be sure that your student loans are under control.

3. Cash Flow is the Focus - Real estate typically appreciates over the long-term. But that’s not why you’re investing in a rental property. You’re investing in a rental property for the income! The appreciation is the icing on the cake. So make sure you select a property with a good monthly cash flow.  You’ll need the rent to cover the principal, interest, taxes, and insurance, of course. But it should also cover your property management expenses, maintenance, and routine repairs. And provide a solid income even after all those costs are paid. 

4.  Location is Key - You already know real estate is all about location. If you can afford something in an up-and-coming neighborhood, go for it! It’s most likely to enjoy greater appreciation than other neighborhoods.  Sometimes these neighborhoods are already saturated and too expensive, so check out the adjacent neighborhoods which will be the ones sought after in the very near future.  Perfect example of a such a neighborhood in Brooklyn would be Ridgewood, Queens which is very close in proximity to Williamsburg.

5. Property Management - Be sure to figure out whether you will be the property manager or you will hire someone to do the work for you.  Either way, you need to have a system in place. For example:  How will you screen potential tenants? How will you collect rent? What will you do if the rent is late? How will you handle repair requests? How will you turn the property between tenants?

6. Always Budget for the Unexpected - You already know to plan for certain maintenance expenses. The roof, appliances, and HVAC systems will all need to be replaced at the end of their useful lives, so you can set aside a certain amount of your rental income for those planned expenses. Everything in life is a gamble to some degree. Real estate is on the safer side of the gamble scale, but it’s still important to mitigate some of the risk. Rather than using all the income produced by your rental property, set some aside in an emergency fund to help with these unexpected-but-inevitable costs.

7.  Stay Organized with a Great Team - You’ll need a way of tracking the financials for your investment property. Many of your ownership expenses will be tax-deductible, so it’s important to track those expenses. And of course you’ll need to track your income. Surrounding yourself with experienced specialists will make your investments more sound and your transactions smoother:  attorneys, tax accountants, property managers, mentors, lenders, maintenance pros, etc.

8. Persistance is key - “Be persistent” is just good life advice! And it makes our list of real estate investing tips because it pertains to every aspect of income property ownership. Finding the right investment property isn’t easy. You need persistence to sift through hundreds of options and choose the best fit. Selecting good tenants also takes persistence. As does working with vendors on maintenance and repairs. Whatever stage you’re at in your investor journey, keep at it! Your persistence will pay off.

                                 

   Follow us on Facebook and Instagram!
&
Subscribe to our YouTube Channel!
Revival Property Group
"Real Estate Solutions At Your Convenience"

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