5 Simple Steps To Real Estate Investment
While there are a lot of reasons for millennials to invest in real estate, it’s not necessarily the easiest thing to get started with. There is a lot of working that goes into real estate investment, which can be incredibly difficult and complicated, even for those that have done it several times before. If you have an interest in real estate investment and wanted a bit more knowledge, then you’ve come to the right place. Here are some simple steps for you to follow.
1. Do Your Research
Unfortunately, investing in real estate isn’t as simple as choosing an alright looking or cheap property and making a down payment; You need to do your research. Look at different types of areas and see what each one has to offer. The same goes for the properties themselves – A three-bedroom home, for example, will offer different things and entice different types of people, than a penthouse for sale. You also need to decide on the state of the property that you’re investing in; A fixer-upper property, for example, would be cheaper than a home that requires little work. However, then you need to factor in the amount of work and money that you’ll have to put into the property for repairs and decoration. Once you’ve decided on these things, you can start looking for your first property.
2. Keep It Cheap
Once you’ve found a suitable property, you need to try to secure the lowest down payment possible. After all, you don’t have an unlimited supply of money, and this way you will have a lot more money left for you to invest in renovations, repairs, and redecoration. Sometimes the seller might agree to sell the house without you having to make a cash down payment. This is usually the case if the owner is eager to get the property off their hands so that they can move elsewhere quicker, or for another reason. An estate agent would be helpful with down payment negotiations, as well as have a lot of property knowledge, so it would make sense to use an estate agent throughout the property buying process.
3. Get To Work
Unfortunately, your hard work doesn’t end once you’ve signed a few contracts. Once you’ve secured your property, you need to get to work and make it the best that it possibly can be. As long as the property isn’t in a terrible state, you can live there while the work is being completed. Make a list of anything that needs to be repaired or renovated and start working on this list first, then do the same with decoration. To save money during this process, do as much of the work as you possibly can yourself, using guides and YouTube videos to help you out. Of course, you should always leave any major repairs to professionals, to ensure that you don’t cause more harm than good.
4. Make Your Money
Once you’ve got your property in tip-top condition, it’s time to start making money from it. There are two ways that you can do this; Selling or renting. If you bought a fixer-upper home, then it’s likely that you will be able to sell your property for much more than you initially paid for it. This profit can then be saved for a rainy day, or invested in another property. Alternatively, you could rent out your property. Just be sure that your monthly rent not only covers the mortgage repayments but also gives you a little profit on top to do with whatever you wish.
5. Do It Again
Once you’ve successfully made money from your first property, it’s time to repeat the whole process and start looking for more properties to invest in. Eventually, you will have enough money saved up for you to invest in bigger and more luxurious properties, so that you can make an even bigger profit. You may even be able to quit your job at some point, as you will be making enough money from your real estate.
While investing in anything can be tricky and confusing, especially for a young adult, if done right, it can be incredibly beneficial. From your real estate investment, not only will you be getting a home for a time, but you will at some point in the future, be able to make money from this home. As long as you do your research, are sensible, and ensure that you only select properties that fit your budget and your circumstances, you should be fine.