Real Estate Investing - Getting Started

After purchasing your own home, many turn to the idea of owning another or several other homes as a money investment.  As everyone and their brother realizes that real estate and the housing market it way low, many might be a little scared to jump in the investment arena.  However, if with a little education and due diligence, right now is an excellent time to invest in real estate.

Interest rates remain low and have dropped some in the past year.  The number of foreclosur ehomes on the market are going up, which makes the number of deals that are easy to find out about and purchase has lowered the average home prices.  So if you are thiking about jumping into investing in real estate, consider the following.

Financing.

As you invest in real estate, one of the biggest components to profiting is to make sure that you have the property financing ready to go.  Unlike a store where you buy inventory, mark it up and sell it, real estate has a few more components.  first you need to decide if you want to rent the home for a little income now while the tenants pay off your mortgage so you have a nice free and clear investment home at retirment.  Or do you want to flip it for a profit now.  If you are going to flip, and you know you have a great deal that you WILL be able to resell, you may consider using your own cash, a more costly hard money loan, or private lender.  If you are going to hold, you will want to be able to secure a long term, fixed rate loan from a traditional lender, a private individual, or maybe even from the seller.

Get help.

You can't be an expert at everything.  By all means do what you have the knowledge, the talent, and the time for.  But you may find that you can pay someone to fix the toliet and get it done in less than an hour or you could learn how to do it yourself, buy several different parts with several trips to the hardware store, and have it all fixed and working in 3 days.  So if it is not something you know how to do, ask for help, get referrals, and check out prices to make sure you are not paying too much.

Learn your market

Market trends are very important.  If you are going to fix up a house, you need to know what is renting or selling in your area, or you could waste you rmoney on somethign that is no longer in.  Just yesterday we learned that oak is out while dark wood is in, brick is out while tile is in, vanity cabinets are out where furniture look is in.

Manage your Real Estate Investments as a Business

Do not treat it as a hobby or things will end up cosing you more money and time than it should.  Real Estate Investing is a business, so treat it like one.

Education

You have many choices in educating yourself on real estate investing.  These choices range from free online events, to books in the $20 range, events from your local real estate association in the $30 to $100 range, home study courses between $500 and $1000, and then bootcamps from $1000 to $10,000 and even more.  I strongly recommend checking out your local real estate association and accessing all the training they have available before you start spending the big bucks.  Get an idea of what it is you want to do, get focus, do some research and find out what training is recommended by fellow investors at the association, and do some online research before you break out the credit card to shell out $10,000 for training.

You will find a complete list of real estate investment associations from across the country online at http://www.nationalreia.com/.  And in the Kansas City Metro area, we highly recommend Mid-America Association of Real Estate Investors (http://www.mareinet.com/)  Membership in MAREI is just $99 a year and you will reap $1000x in educational materials, networking, and money saving benefits.