Buying An Investment Property
There are many factors that converge when deciding whether to purchase an investment property. We want to help streamline this process so you can make the choice best suited to your unique needs and goals.
The first step you’ll want to take is determining what your overriding objective is for purchasing investment property. Do you wish to gain a passive monthly income, increase your net worth, begin a college fund for your children or grandchildren or perhaps leave behind a legacy or a combination of the above? Once you’ve determined your objective(s) be sure to take stock of your risk tolerance and the level of commitment you have to realizing your objective.
Next you’ll want to develop an action plan for reaching your objective. This includes issues such as clarifying your current financial position and future financial requirements, calculating your cash flow capabilities and choosing a timeline for implementing this action plan. All that remains is implementing your action plan.
Here’s a quick overview of this four-step process:
Determine your objective(s), risk tolerance and level of commitment |
Develop an action plan with realistic timelines |
Gather your ‘team of experts’ to help clarify and implement the plan |
Take action and review the plan regularly
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Top 5 real estate investing tips?
i. Your real estate investment business plan should always focus on real estate in fundamentally good communities. Look for population growth, higher than average family incomes and expanding transportation routes. These communities hold their value well and will often appreciate strongly.
ii. After you've found a good community then find a solid property. An attractive home will always rent easier and sell faster. You protect yourself by purchasing a good property in a good community. And starter homes will typically not rise and fall as fast and hard as high end luxury real estate.
iii. Don't buy a property because it's a "good deal". Buy a property because it is in demand and will sell or rent quickly.
iv. Your real estate investment business plan should involve surrounding yourself with an experienced team. The team is more important than the property because they will steer you around obstacles that you may not even be aware of. Look for real estate brokers, mortgage brokers, lawyers and accountants with real estate investing experience and not just real estate experience.
v. Most people create a real estate investment business plan that will over estimate what they can accomplish in one year and underestimate what they can accomplish in ten. Keep the big picture in mind and never stop driving towards it! Keep things in perspective and expect bumps along the way, ultimately they make you stronger.
Jimmy is an active full time realtor, real estate investor ,landlord who manages his own and clients residential properties.
Contact Jimmy today and see how he can help you develop your real estate investing plan.
905-575-5478 (Hamilton Area) 905-639-5258 (Burlington)
Also learn ...
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-->What 7 things to look at to know if a home will make a good investment or if it’ll be a money sucking black hole.
