One Way To Be Rich
Posted on September 1, 2007
Filed Under Business, Money |
Real estate can be a rather complicated world and somewhat, risky. However, if you learn the tricks of the trade, it can definitely bring in the money. In real estate investing, you will need entrepreneurial skills and vision, and time. To start with, you can browse around the internet for online real estate investing schools. In my search, I came across PEI University - a free online learning community that teaches the strategies and techniques of real estate investing.
Like other business, you have to make some investments and deal with both good and bad tenants. You also have to keep track of your cash flow. It is important to keep a strong positive cash flow so you can have more options and space to maneuver. Once have stabilized your business, created a system and have a stable positive cash flow, you can then sit back, relax and enjoy your life or start a new career.
Neophytes in real estate investment can start with the single-family home investment strategies. This can be categorized into three: Buy and Hold Strategy, Buy Low-Sell High Strategy, and Leasing Strategy. The starting point for most investors is the buy and hold strategy. The goal here is to buy the house with the intention of renting it. To be successful, you must buy under some set price and terms that still allows you to have a healthy and positive cash flow. Your rent must be higher than your mortgage payment.
In the buy low-sell high strategy, you buy a house in a neighborhood where there is a high sales activity. Then, make some changes, structural repairs, cosmetics, and then sell at a higher than what you paid for. In this strategy, you have to keep in mind that your purchase must be low enough so you can still have enough budget for the renovation and get a relatively healthy profit.
The last strategy is the leasing strategy. To be successful in this strategy, you have to look for a property that you can lease under favorable terms and where you can give the rights of use and occupancy to a tenant who agrees to pay a price higher than your own lease. This strategy is more commonly known as subleasing.
Once you know the do’s and don’ts, real estate investing can be a great way to achieve financial freedom that does not require you to work 8 to 10 hours a day behind a desk.
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