With every new year there are new ways to get ahead of the curve. Aside from contacting us at Kontor, there are some great tactics that will help you be successful, be it commercial, industrial or residential real estate.
These tactics are widely used and have been recommended by prominent figures in today’s real estate market, so give them a shot and let’s stay ahead of the curve!
Let’s start with the always obvious but eternally important, networking. Meeting people opens up opportunities, so take the time to meet those who are in the same business as you, and everyone else while your at it! Relationships like this take time, effort and patience, so be sure not to rush things or become discouraged!
- Personal Property
Before delving into the market for some grand deal, secure yourself. This means buy your own property to inhabit first, this will allow financing to become easier with less down payments and better interest rates. Plus, you need somewhere to live! Once you have secured a place to live, give it a year or two for some financial build up thanks to those tax write-offs and then repeat the method going forward. Once you have found a new home, keep the first home and rent it out for another form of income. When searching for your next home, look for an owner-occupied home with low down payment and some good interest rates.
- Keep a keen eye on expenses
Expenses can rack up quickly and leave you in a not so secure situation. When purchasing any form of property, there will always be hidden costs relating to rehab and some repairs or maintenance. This is especially true when it comes to purchasing single family rentals. The maintenance is borne by the owner, not the tenant. Sometimes the time it takes to turn over a rental and find a new one to delve into will result in additions to repair costs and the loss of potential rent. Keep this in mind.
- The market has the final word
The power of the market should be cautioned. The market will have the final say and can drastically alter the situation involving demand and prices. Invest with long-term capital and stay focused on your financial flow and returns. This will be true no matter the market you choose to enter.
- Aim for plausibility, not desirability
Understand the market your entering, before you enter it. This is not a good place to learn by being thrown into the fire. Investment properties may be popular right now, however they do not result in instant money. Investing in a property will require a lot of blood, sweat and tears, so set reasonable expectations that can be achieved in the time-line you have.
Often time, beginner buyers use their leverage to purchase properties. This limits the possibilities for potential financial growth, so it’s best to use your own cash, be patient and save the leverage, you will save more money and it will be less risky.
- Look to your strengths
Sometimes in the process of your first purchase, you will find some manner that will benefit you greatly, resulting in a good and profitable property. Define what it is that resulted in such a great property and hone in on it. Focus your sights on what works, and refine it so it becomes even better.
- You can divide with emotions
Many fail in this business because of their fear or greed driven emotions that push them towards decisions that they regret. Separate your emotions and focus on the numbers. Research all of the costs of any investment, not just the CAP rates and yield. Contemplate the potential changes that will occur on your financial situation and act accordingly for whats in your best interest.
New or a veteran, it doesn’t matter. These tactics and tips will allow you to be more educated about your decisions in the market and result in your financial situation and property control being in better positions.
If you need help, we are here for you! We at Kontor keep you ahead of the curve, just give us a call or send us an email and let’s start building those portfolios!