Real Estate investing has turned out to become the craze today with people getting involved in the program. Even though the real estate in various cities fluctuate from time to time, as a whole, it will never experience a serious decline because real estate investing will forever remain a lucrative form of investment. According to the records, it always increases its value and there is no good reason why this will not continue.
Below are the key principles to riches
Principle #1- The money is made
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Real estate investing is like the value investing you see in stocks. In this form of investment, you want to purchase the real estate during a period of slump to get a huge capital appreciation when the market heats up again. Spend time doing valuation if you cannot please yourself on the maths that is a reasonable proposition, there is no way that your investment would be a good one.
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Principle #2:Check the Cash Flow:Principle #2: Track The Cash Flow
Typically, real estate investment have a rental income on a month to month basis which is used to pay for mortgage installments and any other problems with the building. You would have to keep a close on the interest rate hikes because they can erode a calculated return on investment quickly. When you have enough cash coming in, it is recommended that you then keep some in case some of the tenants do not renew their property.
Principle #3- Leverage on other people’s time
You have to do what you do best. If you are good at negotiating, then spend time searching for property and get contractors and professionals in handling all the rest of the deals. if decorating means anything for you, then you can try that as well. By focusing on what you do best, you are leveraging on their time and can make more money from each real estate investment that you do. Build your team and you will see profits start going up.
Principle #4: DO not Underestimate The Power Of Leverage
Did you know that a lot of real estate investors started with little money? Even huge developers like Donald Trump has learned the essence of leveraging. If you leverage, you will have a control of the property more than what you own.
Principle H#5: Befriend The Professionals
The best way to learn is to friend the other professionals and make friends with them because they are your eyes and ears about the recent changes and developments in property, rental, and infrastructure of their location.
In conclusion, use these five principles to your real estate investment.