To Learn or Not to Learn
It has been embedded in our minds over the years to go to college & earn a degree. Further education is meant to improve your understanding of the field you choose to pursue. However with freelancing on the rise, the “textbook guide to success” you may be used to is altering.
The idea of striving for success without an education is popularizing. Can this aspect work in the world of real estate investing? Here, we figure out whether education or experience matters more when owning the most profitable investments.
What’s There to Learn in Real Estate?
This is one of those golden age questions that could be answered in a million different ways. What do you even have to know in order to get into real estate investing? You’re after the most profitable investments, so how do you go about closing the deals?
Here is a small list of things you should know when going into real estate. This list is not exhaustive, but we want to cover the surface of what knowledge is essential to understanding real estate investing.
“Why?”
Believe it or not, asking yourself why you want to get into real estate investing is crucial to how you go about your real estate business. You are the one dictating deals, looking for opportunities and putting yourself out there.
The most successful real estate investors know themselves before they know the tricks of the real estate trade. That is who you aspire to be. Owning the most profitable investments takes self will, don’t lack it.
If you understand your aim and own intentions, you’ll be able to come up with investment strategies that work for you. Know yourself, know your goals, know your weaknesses and strengths and you’ll see how far you’ll go.
The Numbers
The list of concepts involved in real estate investing can be contrived in a whole book. Cash on cash return, return on investment, and occupancy rate are only some of the many critical real estate metrics used to evaluate investment properties. Mashvisor can make half of the numbers job easier by giving you the digits. We are able to project those metrics with the use of data collected on thousands of states, cities, and neighborhoods. Yes, even down to the neighborhoods.
Related: How to Do a Neighborhood Analysis in Real Estate
Mashvisor is more than happy to give you a property valuation when you’re out buying an investment property. However, the numbers themselves mean nothing if you don’t know what they stand for or what they indicate. Whether you learn it when pursuing your real estate degree or looked up the definition using Google, you have to know them. Your investment property analysis depends on it.
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Finance, Costs, and Profitability
Whether you decide to finance the rental property yourself or look for other ways of funding, you need to know how the money will be flowing. You are on the lookout for the most profitable investments in real estate. To make the actual profit, you will be devising financial investment strategies and plans.
This way, you understand your costs and demands. This is incredibly crucial to getting to know your investment property at EVERY monetary angle.
Focus
What aspect of real estate will you want to focus on? There are so many types of income generating assets out there. Some can even be considered part of the most profitable investments. To name a few, some of these can be:
- Fix and Flips
- Residential
- Vacation Rental Homes
With any of these choices, you have the option to use Mashvisor. You know where to go for the numbers whichever route you choose, ehm ehm.
The list goes on. Be aware of your choices and what each will demand from you as a real estate investor. This is in regards to what you will contribute both financially and personally.
You have a huge personal contribution as you know what your strengths and weaknesses are more than anyone. Choose a focus you can specialize in with confidence, as it will match your personal portfolio. The real estate rental investment strategies you choose to go with reflect on your success, so choose wisely.
Now, the question is, how do you learn? Lectures in a classroom or lessons from real estate life?
Education’s Purpose in Real Estate
The purpose of education has evolved over the years. No matter the type of education, there is one common function: to educate and develop.
In regards to what we know as education to this day, how does Foshay’s definition apply to real estate investing? It is rare to find colleges out there that offer you a degree in real estate investing itself. You can learn of the inside outs of real estate, but not how to invest. However, this knowledge of what real estate is and what it consists of can come in handy.
There is no such thing as useless information with a real estate education. Real estate degrees exist for people who want to learn more about the industry. Whether you consider yourself one of those people or not, information is a must. The lessons you learn in the classroom will be implemented when you buy the most profitable investment properties. You will have a textbook work ethic, with your own special twists.
Related: What Are the Most Important Aspects of Real Estate Education?
However, this shouldn’t be your only reference. Textbook principles will only take you so far. You need to go above and beyond to own the most profitable investments. How? Through experience.
The Necessity of Experience
What happens if you never decide to enter real estate investing classrooms? Is there really an alternative to the college lectures that mold your knowledge in a specific way? Yes, and we call it exploring the world. You have the ability to network, to speak, communicate, write, type, ask! These basic human functions differentiate you from the rest of the species on this planet. So why wouldn’t you use it?
Learning the definition of cash flow will do you nothing if you don’t know how to achieve it. The most profitable investments in real estate are worthless if you can’t make the deals and profit. Your ability to calculate return on investment will be function-less if you don’t know what to do with that return. This is why the real education starts OUTside the classrooms.
Applying your Knowledge
Getting your hands dirty with the most profitable investments will allow you to learn from your mistakes. Speaking to other real estate investors will allow you to develop and revise your own plans. You can find a number of podcasts where reputable professions speak on hundreds of real estate topics. Talk about learning real estate education for free.
Mashvisor’s product itself is able to give you all the numbers at the tips of your fingers without any tough calculations involved. There are a number of different real estate investing websites to utilize, and they are made available to you for a reason.
For example, you can find a number of real estate crowdfunding websites that specifically function to raise money for investment properties. You get the financial help of other real estate investors, just by clicking a link! Sure, getting to know the fundamentals of finance is very important, but the way you apply it in your real estate business is even more important. Financing the most profitable investments couldn’t be any closer in reach.
You can make it work without the real estate education, as there is so much to learn out in the real world. If you are out to own the most profitable investments, getting your real estate intellect in order is more important than anything.
Knowledge vs. an Education
We understand you might be thinking, aren’t knowledge and education the same thing. The answer is absolutely not. There is a difference between being able to read the word “red” and knowing how “red” looks like, is there not? That is the case in real estate. Here are some concerns with earning a degree in real estate with the hopes it will help you in investing in real estate:
- Investing in real estate is an extremely localized venture
What works in some areas may not work in others when investing in real estate. Knowing the current real estate market is crucial. The most profitable investments aren’t going to jump out at you. College won’t do the real estate market research for you. It all goes back to you.
Related: 5 Tips on Researching Investment Properties
- Real estate markets and lending regulations are changing all the time
Being in the actual real estate business causes you to be constantly aware of changing policies. Majority of the time, there are fees that come with violating those regulations.
The most successful real estate investors stay aware of the changes to avoid those fees and keep the money in their pocket. It is hard to believe a college curriculum is willing to constantly update with these regulation changes.
- There are many different real estate strategies and places to buy real estate
As a real estate investor, you’re going to be after the most profitable investments. There are a number of investing strategies that work for many different people. However, how are you sure you’re being taught them all? How do you know which is the most suitable for you? We could imagine colleges don’t provide you with that answer. Experience and trial do, however.
- Every state has specific real estate laws and practice
What works in one state may not work in another or even be legal. It is uncommon to find colleges teaching and staying up to date with the individual state laws.
You know the real estate market you want to invest in, so why not just keep yourself educated on that specific market’s laws. If you find one of the most profitable investments in Los Angeles, what use will Cleveland laws do for you?
The Verdict
You’re taking your own risks as a real estate investor. It takes your rental property investing intuition alongside your knowledge to find the most profitable investments. It is your money that is being put into the most profitable investments you target, not your degree’s. Realistically speaking, the money you put into learning about real estate can be put into an investment property instead.
There is a risk to both an educational investment and a property investment. Which risk you are willing to take goes back to you as a real estate investor. Would you rather pour money into a degree that may not have any use? Or pour money into income generating assets that have the potential to turn the $1 to $100? The choice is yours.
Don’t disregard due diligence. It would be foolish to just buy an investment property without knowing what you’re actually getting yourself into. You need education, but how you decide to obtain the knowledge is what is debatable. Learn by actually investing in real estate.
If you did your homework, you will make money while you are learning instead of going into debt. The most profitable investments are out there, so go get them. Time is ticking, so let Mashvisor help you when you’ve made your property pick.
To learn more about how we will help you make faster and smarter real estate investment decisions, click here.