Real Estate Investing Basics


When first starting out as a real estate investor, it is essential to understand the industry and know the basics. There are many common mistakes that new real estate investors can make by having incorrect assumptions and relying on their misguided instincts. Below are a few tips to help new real estate investors avoid common problems.


Lack of knowledge can be a great limitation for a new real estate investor. Investing in real estate can be risky if the investor has not done their homework. New investors should learn as much as possible before buying their first property by purchasing helpful books, attending meetings with other real estate investors, or listening to advice from successful people. Once the new real estate investor has taught themselves the basics, they must research their location and markets. Understanding the local market is key to success as a new investor.

Do the Math

Before purchasing a property, a real estate investor should calculate all of the variables to make sure the investment is a good purchase. A real estate investor should make sure they never overspend by forecasting future profits and determining the costs to buy and hold the property. New investors tend to forget all of the additional expenses that come with an investment property such as property taxes, utilities, repairs, insurance, and management. Making sure all expenses are included in these calculations is key to being a successful real estate investor.

Be Realistic

Some new real estate investors believe that investing in real estate is simple, easy, and will produce a profit immediately. Investing in real estate is a long term commitment and understanding the time and money required to invest in real estate will help the investor be more realistic and patient.

There are many items that new real estate investors to not take into account when starting out. By following these guidelines, a new real estate investor will have a better chance at being successful. Comment below with your thoughts and follow me on twitter!


Photo Credit – Tanamera Construction

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