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What's the best advice that you've learned about investing in real estate?
By following mentor(S), what's the best idea have you learned concerning real estate?
- Thread starter Shannon Sandquist
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I've tried to compact the top 80 lessons into my book.
The most important one: buy at least one, impeccably managed.
Another one: a car is a money pit.
Another one: Don't confuse getting things done with doing them yourself.
Another one: red money, green money & blue money i.e. how to get paid as an investor or as an expert in a win/win fashion. More on this here: http://myreinspace.com/threads/blue...expert-deserves-to-make-some-money-too.29091/
The most important one: buy at least one, impeccably managed.
Another one: a car is a money pit.
Another one: Don't confuse getting things done with doing them yourself.
Another one: red money, green money & blue money i.e. how to get paid as an investor or as an expert in a win/win fashion. More on this here: http://myreinspace.com/threads/blue...expert-deserves-to-make-some-money-too.29091/
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Wow, not sure how this is bad advise, I've built a 4.5 million portfolio doing this (approx 7 years), keeping 20 percent equity in each property and continue to enjoy cashflow. I could've retired at 37 but enjoy it too much.
Lisa
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What I've learned is sometimes there is a time to refinance and sometimes to sell. Depends on many factors. Neither above is right or wrong. The most important thing I've learned is you make almost all your money on purchase date.
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Another good one is never take advice from anyone who brags about how much they've made or how rich they've got off real estate.
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Leverage works in flat or rising market.
Do you want cash-flow or a high ROI ? More on that here: http://myreinspace.com/threads/what-is-better-cash-flow-or-higher-roi.26596/
Do you want cash-flow or a high ROI ? More on that here: http://myreinspace.com/threads/what-is-better-cash-flow-or-higher-roi.26596/
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Good advice above 
1. Don't trust information marketers
2. Lots of ways to make money, absolutely nothing special about real estate.
3. Don't work with people concerned with getting rich and only talking about money. They don't care about the product at all and are just in it to make a deal. Worst customers and worst business partners.
4. Do the math
1. Don't trust information marketers
2. Lots of ways to make money, absolutely nothing special about real estate.
3. Don't work with people concerned with getting rich and only talking about money. They don't care about the product at all and are just in it to make a deal. Worst customers and worst business partners.
4. Do the math
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Always peform your own due dilligence and triple check all the numbers, make conservative projections and build in a healthy reserve fund.
I'm very new to this (only purchased one property so far) but so far organizational skills have been the most important. Real estate binder and ways to systematize stuff are essential. It's amazing how disorganized most people are! Most of the nuts and bolts of real estate are fairly easy to grasp: cash flow calculations, cap rate calculations, TDS/GDS scores, under or overvaluation of an area, economic prospects of an area, etc. But if you don't have the organizational system to keep track of the data, your own financial information, your tenant information, etc., you'll be completely lost.
Examples of this:
Examples of this:
- the bank wanted to verify some large deposits into my account during the mortgage application process. I had a $38k deposit here, a $90k deposit there, etc. Some of these transactions went back 2 years. I had a response for them in 2 seconds thanks to being organized. If I were to ask anyone else in my family about a specific bank transaction 2 years and ago and demanded the accompanying proof they'd be totally lost, lol.
- bank wanted a net worth statement. I can produce a net worth statement that has up to the second information since it's tied to stock quotes and my bank account. I also have recent appraisals for my residential properties with accompanying appraisal docs.
- created a spreadsheet that spits out cap rate, cash flow, ROIC, ROI, principal paydown, etc. to quickly analyze opportunities that come up. All you have to do is enter the mortgage amount, mortgage rate, rent, taxes, utilities, etc. Many real estate brokers don't even have this sort of system in place--even ones that claim to work with investors! I was working with one agent on a potential property and she's like "well you'll want to give this rental information to someone to calculate the investment return, I sure don't know how to do it." I'm thinking you're an agent! you don't even know how to calculate basic numbers! how is this possible! After 1 minute I had the basic investment numbers nailed down and she thought I was some sort of wizard, lol.
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The most enjoyable time is will be when you sell a rental property.
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Why is that ?
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Decisive action.
Guarantees profits from paper to actual.
Eliminates second guessing of should I refinance? should I have refinanced? should I upgrade? should I do the repair or replacement? Should I sell? etc.
If you self manage, you also eliminate the time to manage.
Guarantees profits from paper to actual.
Eliminates second guessing of should I refinance? should I have refinanced? should I upgrade? should I do the repair or replacement? Should I sell? etc.
If you self manage, you also eliminate the time to manage.