You are the key player to strategize and materialize real estate success stories. Some might think investing in real estate is a more passive job, yet no investment is completely passive. In other words, the more passive an investment is, the less money you will make. The amount of time you put into your real estate investments is positively correlated to the outcome. And in the real estate industry, time is dependent on your experience, your level of skill, and your property management. And similar to any other type of business, it will take much more time for a novice investor starting out and learning about the world of real estate before they make money.
Making money in real estate doesn’t happen overnight; real estate investors need to have an action plan that is aligned with their goals and expected outcome. Before deciding on any type of investment, real estate investors need to carefully research and study the investment property in question. Understanding and knowing your property will be the first stepping-stone to making money in real estate. You should be researching the details of your investment strategy and decipher whether or not it will meet your business expectations down the line. You should be spending sufficient hours each week tracking your money and planning your investments. If you don’t take the time to research and track where your hard earned money is going, do not expect fast results in the meantime. Before you actually start making money in real estate, decide on a real estate strategy that works for you. The best way to start making money in real estate is to search for positive cashflow properties that will earn you high returns on your investment. Mashvisor gives you access to many properties across America with positive cashflow returns in your area of choice.
Strategies for finding positive cashflow properties
There are many strategies that you can implement today to capitalize on positive cashflow properties and seek higher returns as a long term investment plan.
Such strategies include, but not limited to;
- Looking in high yielding suburbs
- Buying properties 20 – 40% below the median price for the suburb
- Targeting multiple income properties
- Buying in regional areas or targeting student accommodation
- Renovating and adding value to increase rental income
- Managing interest rates and fixing when you think the current interest rate is at the bottom of its cycle
There are many different property types that you can use that will have you making money in real estate in no time. Positive cashflow properties are just one of various types of properties that will help you make money faster. Here are the best strategies to making money in real estate;
- Fix and flips houses
Fixing and flipping houses is an excellent short-term real estate investment strategy. In order to succeed in making money in real estate, house flippers search for undervalued homes that need renovation, then renovate and sell those homes for a profit. This type of strategy is not a scheme that makes you rich over night, but if done correctly investors can quickly profit from this strategy and make money in a short period of time. It’s important for investors to look for deal-breakers when searching for a property to flip. After setting a budget, it’s crucial to consult an inspector, contractor, and appraiser in order to identify issues and avoid losing time and money. When flipping, time is the biggest asset. The longer it takes to flip the property, the more monthly expenses you will incur.
- Real Estate Wholesaling
Making money in real estate does not always require spending money. You see, there are so many diverse opportunities to invest. One of the ways you can create an income without having to spend any money at all is by wholesaling. A wholesaler finds a seller who wants to put their property up for sale and has not yet gone on the market. The wholesaler finds a buyer and then is entitled to a share of the selling price. To be successful with the real estate investment strategy, you have to network and build a repertoire of business clients in order to accumulate a database of potential sellers and buyers.
- Apartment Rentals
If you live in the city and vacancy rates are low, consider tapping into an opportunity to make money in real estate by renting your apartment. While representing tenants can be lucrative, the real money is made representing management companies and small landlords. If you have an exclusive listing in New York City, you can charge clients up to 15% of the year’s rent as a commission. Apartment rentals are great investments especially in big cities. These types of properties don’t require a lot of time before you start making money in real estate.
- Vacation Properties
A vacation property is probably the most exciting way to be making money in real estate. Not only can you earn income from rentals, but you never have to rent a hotel room again! Homes in popular vacation areas tend to appreciate in value more than properties in other locations. And make sure you know the ownership expenses as well as the maintenance costs you might incur.
At the end of the day, pondering the “HOW LONG” until-I-make-money-in-real-estate is conditional on many factors, including your determination and long term real estate strategy. Frankly speaking, there is no right formula to investing and making money. Investors continuously change and adjust their real estate investment strategies by aligning their expectations and goals with the current housing market and economic trends. Be proactive in investing and do not count on luck to get you your big win, it is all about how smart you invest in this industry after all.