Helpful Tips to Follow When Buying Your First Real Estate Investment Property

 

The real estate investment business is dynamic and not for those who like a familiar routine but if you are ready for a challenge, this can be perfect for you! Every beginning is tough and chances are that you have the enthusiasm but not enough knowledge on how to start. But don’t worry, we’ve got you covered – with that in mind, here are some helpful tips for you to apply on your real estate investment venture.

Get acquainted with the financial side in detail

Getting familiar with the financial side of your first real estate investment is crucial because even if you find an excellent property, it won’t matter much if you haven’t made up a plan on how you will pay for it or its renovations. You need to know what you are getting yourself into, especially at the beginning because one wrong move could hinder your plans or pause them for the time being.

Besides deciding what will be your source of finance, you need to be aware that the property itself will not be your only expense. If you are planning on renting it, some repairs are inevitable as well as renovation to some extent. Simply put, you need to make a decision on how much you are willing to invest based on your prospects of renting it. You should take into account the neighborhood, the vicinity of schools, hospitals, supermarkets, the infrastructure etc. because those are the elements that your prospective tenants will investigate before renting. 

Consult with real estate investment experts

Having in mind that this is your first time stepping into the arena of property investment and that you want to make it right from the get-go, consulting with experts is a prudent choice. Nowadays, there are agencies that provide real estate investment services that incorporate legal and taxation consultation, help with the sales and purchase agreement and even the key handover. This will ensure that your first real estate investment is a success.

However, you aren’t limited to using their services only once - you can hire them as many times as you want until you are confident that you can find your way around the real estate industry. Once you become more independent, you can still use their advice on choosing the best up-and-coming neighborhood or even expanding your reach abroad. But let’s first take baby steps and learn how to make calculated risks and build a strong position on your local market so that you can one day expand. 

Consider turnkey real estate investment

If you find the whole idea of purchasing a property which requires renovation before being rented a bit stressful as a beginner - that’s completely understandable and you are not alone in this. You need to assess what needs to be improved and in which way because the most attractive rentals always have something which sets them apart from others. Also, finding an honest crew that would get the job done as soon as possible without you breaking the bank is a nightmare for some.

But there’s no reason to worry since there’s a way around this and that is acquiring turnkey properties. This means that they are already renovated and ready for renting as soon as you purchase them. Having it immediately on the market will give you a competitive advantage. The tenants would be happy they can move to their new place straight away and if the property is in a good neighborhood, you can even set the rent higher than you originally intended. 

Maintain an emotional distance

For a beginner, maintaining an emotional distance is perhaps one of the most challenging aspects. You are already confused about all the things that you need to make a decision about and check and then you see what seems to be a real estate property of your dreams. Instead of looking at it from the perspective of an investor, you start fantasizing about retiring in that place and this is something you shouldn’t allow yourself to linger on.

Simply put, you will review perhaps hundreds of properties before you find the right deal so it makes no sense to get emotionally attached to them. Such behavior might cloud your judgment and you may end up with a property that is in fact in a bad shape and which needs a lot of repairs. This is why you need to have a professional approach and observe those properties as assets that have benefits and flaws.

Over to you

Now that you have covered some basics of real estate investing, it is time to set sail for the first time! Use all the resources you can find and consult with experts so that you can strike the right deal. If this first property is a success, that will give you the necessary boost for all of the subsequent ones. So, lift your head and embark on your first real estate investment journey! 

 

About the author:  Mike Johnston is an avid blogger and content writer with a focus in real estate, home improvement, and the construction industry.