When discussing real estate investing practices, the idea of active versus passive investing is often one that is the root of many heated debates amongst investors. Like many other investment practices, there are strong pros and cons for each method, however, understanding the complexities of each and how they relate to your specific investment needs is what’s most important. Active Investing Active real estate investing can be characterized as the...
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Diversification is essential to mitigating your risk as a passive real estate investor. Chances are you became a passive real estate investor because you did not have enough time to devote to your investment business or because you do not have the knowledge required to become a successful active investor. However, there is another very important reason to become a passive investor and that is the opportunity to diversify, even...
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You can rest assured that you will make some mistakes when you start your real estate investor business. That’s ok, as long as you learn from your missteps. Here are seven of the most common mistakes entrepreneurs who make when they invest in real estate, and how to avoid them. 1. Not Keeping your Eyes on the Prize: When you start your real estate business, make sure to have a...
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Smart investors looking for a good investment opportunity in real estate turn to multifamily buildings for an attractive return. For many, the main advantage that comes to mind is a steady income stream but there are many other benefits to multifamily ownership as well. With a rental property, you are likely to hand off the day-to-day management to a professional property manager so you can become a passive investor. Here...
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Attracting good tenants who will stay on is a vital aspect of real estate investment as it will keep the vacancy low and turnover costs down. When you develop a cohesive rental community, your residents often pitch in and help you find like-minded renters in the future. Capitalizing on your Unique Selling Position or USP can help you brand your apartment building, explain why it is different from the competition...
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Careful analysis of the market can give you a pretty good idea of what you can expect from an investment property. We will discuss the 4 Key Factors that will make up the bulk of Market Research. 1. Demographics Demographics show the composition of the population and can predict real estate demand in a particular area. Age, gender, migration patterns, and income all play a part. Analyzing demographics can explain...
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Supply and demand determine the price of real estate, just as it does for everything else. But what determines demand? It would be wonderful to have a crystal ball to forecast demand for industrial and residential real estate in order to evaluate investment opportunities. While no one knows for sure what the future holds, successful real estate investors know that employment is the number one factor driving real estate demand....
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You have probably heard about real estate investors who use leverage to purchase an investment property. This technique involves putting up a small amount of your own capital relative to the price and using the bank or another source of financing for the rest. Some investors swear by this technique, but is using leverage for financing your investment really a good idea? Leverage vs Loan-to-Value Ratio The leverage on your...
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Now that you are a successful investor with a multifamily property and a community of good tenants, you may wonder how to keep them happy. Good tenants are respectful of your property, follow the rules and pay their rent on time. So how can you encourage them to stay on so you don’t risk vacancies and incur expenses associated with finding new tenants who may not live up to the...
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Most investors find a property by working with a real estate agent and buying a commercial property listed on the MLS, the Multiple Listing Service. Sellers market their property through their agent, and potential buyers like you make an offer. For investors, competition for the same asset can lead to bidding ware if multiple buyers are interested in the same building. We will discuss the advantages of buying an off-market...
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