Beginning your adventure as a real estate investor can be quite exciting and also intimidating. The question is why are we intimidated?
Our answer to that is it means most of us are simply not prepared.
Think about it for a minute. Do you believe NBA players are nervous when they are at the free throw line in front of millions of people?
Most likely not, they are confident and ready. The main reason for this is because they have practiced that same exact shot probably before they could even read.
The same goes for real estate investment. The more prepared and informed you are about the market you are entering the most comfortable you will be with the process.
So the purpose of this section is to give you some advice on how we as investors can go about doing that.
Research your local pricing trend
Some of the most important real estate trends are right at our fingertips, especially with the internet being so advanced these days. A little research can take you a long way.
As an investor we want to have a good understanding of prices around our desired investment area and how long it has taken for those properties to be sold.
It’s not enough to just research the property you want to purchase but we need to really get a sense of what that entire area has done over time.
Here are some great tools you can use to research your local market:
- WordPress plugin called Movoto Market Trends.
- Investors Universe through Real Capitol Analytics.
- org website for local market research.
These are just to name a few tools that are out there to help you study up on your local real estate market.
Investigate property taxes
I’m assuming you live in an area with surrounding cities. Now what you will want to do is look into which cities have a lower property tax. Obviously, the city with the lowest taxes will probably be more competitive. That could be a good thing for you.
This means real estate agents are probably relaying this information to their clients and these properties with fewer property taxes will be more appealing to buyers.
Here is a video we found that will help you understand property taxes better:
How strong is your market currently?
By doing a little research and building relationships with real estate professionals you can get a good idea of the type of market your local area is in. Here are a few questions you could be asking before an investment:
- Is it a buyers’ market or a sellers’ market?
- What are the homes for sale inventory?
- How does our local market compare to the national market?
I encourage you to do your own research and come up with a series of your own questions you would like to understand before diving into an investment property.
Asking informational question like these will give you a good perception of where your market prices are going into the future. A very big factor when pouring your hard earned money into property.
Invest in a mentor and training
If all this real estate investing is new to you I would highly recommend reaching out to people that already have been in the trenches. Now you don’t have to go out and find the most expensive investing coach in the U.S.
Talk to people in your local area that have been involved with real estate investment and buy them some breakfast. I’m sure you can get a lot of important information from simply talking to people in your own network.
Most of the time successful investors want the same for everyone and a lot of the time they are more than willing to share their expertise with a person new to the game. Remember everyone starts somewhere. We don’t become masters at our craft overnight.
What we really would like you to get from this Is don’t be in a hurry for the sake of buying up real estate. Do your homework and really get a good feeling for is currently going on and what perceives for the future.
Then once you have come up with enough information make you investment purchase with confidence. Educating yourself on your local market will go a long way and give you the assurance to help you make an intelligent decision.