Real Estate Investing – It Really Sucks If You Don’t Know This

Can an ordinary individual that has never invested in real estate really make money? Or, will the risk kill him/her financially?

Evidently, it is possible if you follow a simple strategy.

A lot of people, when they think about making money in real estate investing, equate this with flipping properties. Much like what you see on some of those TV shows. Well, as it happens there just maybe a better way. A way that promises to reduce the risk of loss significantly, and at the same time gives you time and money to increase the value of your real estate property before you sell it.

Reducing the Risk

When you look at or study successful long-term real estate investors, you will find they have multiple rental properties. They don’t simply “flip” their way to profits. They build a passive income real estate portfolio first, then cash out when the timing is right. This is a technique almost anyone can model.

It is smarter, making it a less risky way to get involved in real estate investing. In a nut shell, this makes it possible to let someone else pay the mortgage, build equity and flip the property when the market in a particular area reached its sweet spot. It is also a much less stressful way of turning a nice profit (even before you decide to sell).

A better model

A big advantage of this business model is, you are not at the mercy of the market. You are not forced to take a loss, or make an all too tiny gain because you need to get out before the next payment is due.

By structuring a real estate property as a rental, you are able to look at the market trends in the local market, and as one of your leases comes up for renewal you are in a strong position to sell for a healthy profit. This puts you in the-drivers-seat. Maximizes control. Reduces stress and maximizes profit.

Structuring property acquisition in this way may not be as “sexy” as flips, but that’s just fine. It’s better to know that your investments are safe, and you are never going to put your future at risk because of one stupid decision, isn’t it.

Thinking about real estate investing for profit, then you might want to look into how to best structure an acquisition, a sale, or a rental. But more importantly the trends as they occur in your local area. While all of this sounds intimidating it need not be. There are many sources of good information available. There are websites that cater to real estate investing as well as membership sites that provide condensed information to their memberships. Having good information, knowing your options has always been the best way to achieve in the business world. This applies to real estate investing even more so.

It is never too early or too late in the process to start acquiring good usable information. A foundation of knowledge and going one step at a time is a great way to minimize risk on your path to financial freedom through real estate investing.