Just thought I would share some tips/thoughts on real estate investing. Our portfolio is still small, but big enough to have learned some lessons I think are worth sharing.
1. Just do it. If you still haven’t bought your first property, yes do your research. However, most importantly, buy your first property. Whether its your primary residence, a house hack or rental, the sooner you get in the game, the quicker you’ll get to where you want to be. Analysis Paralysis is a real thing and something you’ll want to avoid.
2. Know your numbers. You’ll want to approach your first purchase as an investment based purely on numbers (no emotions). This is especially key when the market is hot, you’ll want to practice patience and land on a deal that makes sense long term. On the flip-side, when the market turns cold, you’ll want to make sure your positioned well enough to not be greatly impacted by market dynamics. End of the day, don’t over-pay, don’t over leverage.
3. Look for Value Add Properties. Turnkey is a popular term sold to beginner investors and there are definitely pros to Turnkey properties. However, very seldom do they work out for beginners (as you’ll likely be paying a significant premium on the property). Instead, you’ll want to look for properties that you can add value to (fixer uppers). Although the idea of “turn key” will sound appealing, you’ll want to avoid turnkey deals (at least in the beginning).
4. Define your strategy early and be ready to adapt. Whether its House Flipping, Rentals, Wholesaling, Short Term Rentals..ect. Define your strategy early and be ready to pivot when it makes sense. Case in point, we originally planned on going with long-term rentals and pivoted to short term rentals when Covid-19 hit.
5. Its never too late too start. Regardless of age or background, its never too late to start. If you have a desire to do it, go back to point#1 and figure out what you have to do to get to property#1. One of the things I love about real estate investing is that anyone regardless of age or background (doesn’t matter if your 22 or 62) you can do it.
Hope that helps someone 🙂