There are lots of questions that should be asked before embarking upon a profession of real estate investment. The most important question that you must ask yourself is can you treat this profession like a business and do what needs to be done to be profitable. If you are shy or aren’t very out going then this business may not be for you. You have to put friendships away when dealing with buyers and sellers and deal with both parties in a fair-minded and ethical way. This is the only way that you will bring in a profit.
There is a very simple principle to stick to in order to be successful in real estate. That is do not let your emotions make your decisions for you. If you can not watch the stock market take profit and losses without letting a bad day cause you to make a bad investment decision this career may not be for you. There are a lot of factors that influence real estate investing that you can not control. The longer you are able to hold onto your investment without getting scared and cashing out, the better your chances are of turning a profit.
A buy and hold investor is someone who holds a property long term and knowing that the longer you hold an investment the better your odds are for making money, bets on that increase in value. Some of these investors will use the property once a year or so for vacations or may rent it out to earn some money off of it that way.
This is a great way for many people to enjoy the luxury of a vacation property without absorbing all of the charges involved in having a vacation property as the rentals will help compensate for some of the costs. You will find these type of investors and properties in high tourist areas. Not only will you be building a strong portfolio of properties but you will have a steady income every month as well.
Other investors will buy rental properties and in order to make a profit you must constantly maintain these dwellings and be sure you can fill them with paying tenants. You must also make constant efforts to keep these properties managed. You have to make sure that you are collecting your rent each month and that the properties aren’t falling into a state of disrepair or abuse by tenants.
Many investors keep the services of property management agencies in order to control the aspect of month to month particulars and collections. This is a great idea whether you have one single rental property or a huge range of rental properties. This management service can take care of the daily routine of rental property allowing you to focus on your investment decisions.
The type of real estate investment you plan on venturing into can become profitable over time if you research before hand and make a commitment to it fully.
By Andrew Watson