Real Estate Investing 101

Our introduction to this topic will include the basics.

Many times, the only factor that separate you from the ‘real estate tycoons’ is a willingness to learn and a some ‘intestinal fortitude’.

Investing in real estate has gotten a lot of awareness over the last few years. Unfortunately however, many people still think this to be something for ‘the big boys’. This kind of black-and-white idea is stimulated by our beliefs, which are basically fed by the media. In movies and TV shows the company of real estate is regularly associated with millionaires and even billionaires. Because most people don’t plummet into one of these categories, it’s painless for them to think real estate to be something that’s out of their league. They might say something like “I’m no Donald Trump, so I can’t do it!”. Have you ever heard anybody make a statement like that? Have you ever thought something along those lines yourself? Odds are your answer to one or both of these questions is “yes”.

Let’s take a look at the world around us to see if our assumptions about what it takes to be in real estate are correct. If you were to look at all the real estate around you, you would quickly find that the maturity of properties are residential. Home owners are real estate investors and as you perhaps know, most home owners are not millionaires. Owning your own home can be a great first move for a number of reasons. Obviously, as the value of your house increases, so does your net worth. However the increasing benefits doesn’t end there. The appreciation of your house over time not only builds your net worth, but it can also give you a great opportunity for creating some leverage. By refinancing your home, you can put overkill money in your hands that you can use to invest in other properties. This could be another residential home generating rental income, but you could also look at commercial real estate.

As we take a closer look, keep in mind all of the useful and important information that we have learned so far.

Many people learn to think about commercial real estate as shopping malls, skyscrapers and work buildings for multinational corporations. This is the picture that is communicated in the media. In reality, the largest type of real estate consists of small to method sized company properties; the corner shop grocery, the neighborhood hardware store and your local restaurant are just a few examples. The value of these properties doesn’t generally run into the millions and many are owned by people that are not millionaires. Not yet anyway. However their investment, if managed properly, provides them with a steady annual gain that puts them on the means to becoming a millionaire over time.

Of course refinancing your home to invest is not something you should do overnight without careful consideration of the consequences. Any investment brings a certain portion of threat with it and you should factor in these risks in your refinancing decision. What happens if interest rates go up? What impact would a decline in real estate prices have on your economic situation? Also, you should review the tax laws in your country in regards to increasing deductions and the taxation of different investments. It’s important to get good guidance before entering into a deal like this, so careful discussion with somebody that is knowledgeable in the part you want to invest in.

Many real estate opportunities don’t command millions to get ongoing and make some money. You don’t have to be a Donald Trump to be a successful real estate investor. What you must do is: have some assets to get started, some homework on the real estate state in your area, some good guidance from people who know what they’re talking about, and most importantly the courage to take the first step. Even if you don’t know everything, it’s a good idea to just go out there and find out what you must to know. You will never know everything and you will perhaps learn more by doing. As long as you make sure that you direct your risks, you will find that there are some pretty good opportunities well within your league.

Don’t procrastinate from what could be a life altering economic decision by not investing in sound real estate deals. Acquire the opening capital, ask questions of those that are successful in real estate investing and just do it! Expand your horizons and be convinced in your new expertise of how to correctly evaluate and negotiate a good real estate deal.

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