As mentioned before, becoming an investor is not for everyone. There are very different levels of investment, and being able to identify which level you want to take your investing career can help determine if this is right fit for you.
Some people may be drawn to real estate because they enjoy doing it, and they love looking at houses and talking about them with potential buyers or sellers. This is what most people who sell their own homes use the profits from to invest in more properties!
Other people may like earning lots of money quickly, so buying and selling a few houses fits into that goal. Still others might have access to large amounts of capital they’re willing to put towards investments, making residential property one option.
Whatever your reasons for wanting to become an owner-investor, the best way to start is by defining your goals and figuring out how much capital you have available to spend. Then, determining whether or not real estate is a good investment opportunity will follow naturally.
Buy property
The next step in becoming a real estate investor is finding your first investment opportunity. This can be done by either buying a house for sale or renting an apartment or house and then improving it.
The best way to get started as a real estate investor is by investing in lower price homes. There are many ways to pick up low cost properties, from listing sites that have a use of their services free until you purchase a plan to actively looking at lower priced houses and offering more money than what the seller has listed.
Once you have found your initial investment, improve it! Renting a house and putting in some additional renovations will save you a lot of money in mortgage payments and equity.
There are several things that can be improved about a home including:
Roof
Siding
Windows
Landscaping
A well-maintained home will draw potential buyers in and help them envision themselves living there. Make sure to do some research and find out what needs to be done on a house and what costs are associated with those repairs.
Remodeling a house is very expensive so make sure you know how much everything costs before starting work.
Repair and maintain
A large part of being an investor is investing in other people’s homes or businesses. This can be done by either buying their house at a lower price or offering them money to sell it to you.
By owning a property, you now have another income source that you can use to reinvest in more properties or simply enjoy what you already own.
There are many ways to stay successful as an investor if you want to take things slowly and keep your debt under control. Make sure to look out for potential investment opportunities and don’t forget about renting too!
We would also recommend reading our article on how to invest in real estate like a pro so you know some of the basics.
Create a good business plan
A lot of people begin their real estate investing journey by buying a property they want to fix up and rent out. This is a great starting place, but it will not lead to bigger and better things.
The first step in becoming a successful real estate investor is deciding what kind of investor you want to be. There are two main types — investment capital investors and growth-oriented real estate investors.
Fund your business
As with any business, being successful as an investor depends on having enough money to succeed. Starting off as a real estate investing beginner is not the best way to go about it if you do not have the funds to invest in property or take additional loans to finance your investments.
You must be able to afford to buy a house that will make up half of your investment! A good rule of thumb is to save anywhere from one to two percent of your income to fund your goal.
Another way to fund your investment is by doing what we call “cash out refinancing”. This means taking out a mortgage at a higher interest rate and adding onto the loan with cash you already have (your savings!).
Choose your team
As we already mentioned, being an investor doesn’t automatically make you rich. You will still have to work hard to achieve your goals. With that said, it is important to not only pick who to invest with, but also learn how to manage them as investors.
People can differ in their investing strategies and styles, so be sure to check out about each other before agreeing to partner up.
Also, don’t agree to do business with someone unless you are completely comfortable doing so.
Know your market
As a real estate investor, one of your main goals will be to find undervalued or vacant properties in high-demand areas that you can improve and resell as soon as possible.
Finding these opportunities is like finding gold — it takes time, effort, and research. But once you do, it’s like winning the lottery!
Before jumping into buying a property, make sure you know what kind of community it is in and how much demand there is for homes within that area.
You don’t want to buy something that isn’t going to sell because the chances are it won’t turn a profit. Plus, you’d need to spend money to renovate it which could hurt your investment portfolio.
Also, know the prices of similar houses in the same area so you have an idea of how much yours should go up. A good way to determine this is by looking at recent sales and average price charts online.
Do your marketing
Marketing is one of the most important things you can do as an entrepreneur. It’s what generates new business, so don’t forget it! When it comes to becoming a real estate investor, marketing means generating leads for potential investment properties.
You can create lead generation strategies that are cost-effective, efficient, and simple to implement. The best way to develop your marketing skills is by reading other people’s success stories and studying successful entrepreneurs.
There are many ways to generate leads including:
Direct mail campaigns
Print ads
Social media advertising
Property listing websites
Referral programs
Telephone calls and meetings
Your marketing strategy will be determined by your goals and the resources you have available. For example, if you’re only investing in fixer uppers, then no listing sites or referrals from friends and family are needed.
Create a website
After you have determined that real estate investing is what you want to do, you will need to know how to start your business. The first thing you should do is create an online presence for yourself.
This can be done through creating a LinkedIn profile, establishing a YouTube channel, or even starting your own website.
By having this web presence, it becomes much easier to promote yourself as an investor and get more people to connect with you.
People are sharing their investment strategies all of the time, so by developing yours, you would be giving them a tip or two while also getting back quality content from you!
Your website must tell your potential investors who you are, what you offer, and under what conditions you work.
