The ultimate guide on how to buy property!
Why invest in real estate, and why learn how to buy property?
I mean, why not?
If you’ve considered investing in real estate, you must have also contemplated how to buy property.
But wait a minute, can I invest in real estate without experience?
The answer is yes and no. Simply put, you can definitely invest in real estate as a beginner real estate investor, but you can’t just jump in without having done some research and talked to other mutual investors. You can acquire primary experience by educating yourself and indulging in the real estate world. This way, you can establish yourself by learning how to buy property.
Related: Real Estate Investing for Beginners: 5 Things You Need to Know
Research and get educated
Real estate investing can be quite challenging and overwhelming especially if you’re just starting out in real estate. It can feel like a whole other language that you need to learn. You should have a comprehensive knowledge of real estate investing before you jump into any market. You have to be acquainted with different real estate terms, real estate indicators, and with researching your local and national market.
You can also look into different real estate books and search for online blogs and sites. If you’re reading this, it means you’ve already taken a step towards your real estate education. For more blogs like this one, click here.
When beginning your research, start with the basics:
- What is real estate investing?
- Look up different real estate investment strategies that you may want to use.
- Learn terms like foreclosure, cash on cash return, capitalization rate, comparative market analysis, investment property calculator, etc.
Mind you that this will not directly make you an expert in real estate investing, but it’ll help get you started. Doing your research in real estate will allow you to have the comprehensive knowledge you need to start your career.
Never underestimate the importance of planning
Planning is of essence when it comes to learning how to buy property. Planning will give you guidelines to follow and will help you in the process of buying and managing your property. Planning also allows you to set your personal goals and to evaluate and control these goals to assess your investment. Say your goal is to make $1500 per month in net rental income. Planning where to invest in real estate, which property to choose, and calculating your costs will aid you in determining whether or not your goal is achievable.
Consider hiring a real estate agent
When organizing how to buy property, you may also want to consider whether or not you want to hire a real estate agent. Real estate agents have a wealth of knowledge in real estate and have accumulated years of experience in the industry and market. They know their way around, so they can also help you in the process of applying and receiving a real estate loan if you decide to take one out.
Remember that hiring a real estate agent is optional. As an investor, you need to weigh the costs and benefits of consulting with an agent before you make the decision to hire one.
Build your real estate network
A real estate network is an important component in real estate investing. Developing a real estate network will help you meet the right people who share the same interests as you. Often times, your network will include other investors, real estate agents, lawyers, accountants, buyers, sellers, among others. And you never know what kind of opportunities may come your way by knowing and dealing with them. Finally, having a real estate network will, without a doubt, enhance your learning experiences in real estate. After all, there’s always someone who could benefit you, give you tips, or simply teach you something you did not know about real estate investing.
Figure out your finances
Assuming you’ve done the math…
Now, on to the big step: deciding how you will finance your investment property. There are so many ways to finance your real estate investment. For one, you can borrow money from the bank by applying for a real estate mortgage loan. You could also choose to borrow from private lenders, like friends, family, or other investors. Another thing you can look into is real estate partnerships. Partnering with another real estate investor will help you financially, risk wise, and management wise. Finally, you can dig into your own savings and self-fund your investment, or use a combination of the above methods. Financing your property goes hand in hand with planning in real estate, so make sure to figure out your finances when thinking about how to buy property.
Choose a real investment strategy
Real estate investing is a broad field, and there are so many real estate strategies that you can use. You may consider traditional rentals, Airbnb rentals, rent to own, fix and flip, buy and hold, or real estate wholesaling. It’s good to get specific and fixate your resources and efforts on one strategy. Try to learn the differences between these strategies and decide which one is optimal for your type of investment.
Find a property
Now that you’ve done all of the above, it’s time for the fun part – finding an investment property. Finding the right property is half the work when it comes to investing in real estate. It will essentially determine how much money you’ll be making in real estate. There are so many things to consider when finding a property, and one of the most important is…
You guessed it: Location!
Location = everything.
Well not really everything, but we’re trying to highlight how important it is when deciding how to buy property. The US real estate market, in general, is doing great, but some areas are doing better than others. Figure out where the best places to invest in real estate are and start there!
Conduct real estate market analysis
The US real estate market is very diverse and different, so you need to know the local market you’re investing in. Look into indicators like population and job growth, migration patterns, recent construction plans, etc. Plus, ask yourself questions like: What’s the rental property demand like in your local market? And what neighborhood or city offers the best investment properties? Is it a buyer’s market or seller’s market? Today, most markets in the US are seller’s markets, but there are others that favor buyers, so you can capitalize on your opportunity in those.
All of these indicators should help you realize the potential in the city and/or neighborhood you select to invest in.
Do investment property analysis
After you’ve analyzed the local market, it’s time to analyze specific investment properties. This will help you find the best investments and answer the question “how to buy property?” Investment property analysis can be tricky at first, especially since it involves many calculations. Mashvisor is one of many platforms that can help you out when conducting your analysis. To start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after, click here.
Make an offer and negotiate
Learning how to negotiate in real estate is part of learning how to buy property. When you’ve set your mind on a specific property, it’s time to negotiate the best deal!
Related: 8 Negotiation Tips for Buying an Investment Property
You’re ready to close the deal!
It’s been a long way coming learning how to buy property; happy investing!
Related: The 6 Steps of Buying an Investment Property