If you are new into real estate investment, there are some certain rules you should follow so that you can get the best out of your investment. In this article, we have compiled 12 ‘golden’ rules just for you!
Start small with the resources you currently have
While starting out as a real estate investor, you may feel that you don’t have much money to help you begin. Sometimes, you have to start by splitting up your own home to rent it out. It is therefore recommended to take a course training on real estate investment as a first step.
After taking such course, you will automatically understand and take advantage of the opportunities. When you have made your first rental success you will automatically be motivated to grow in it.
Broaden your knowledge
In some scenarios, some people who have ‘accidentally’ gathered one or two properties get stuck because they don’t know how to grow their real estate portfolio into a passive income. At this point, you will need to gather more knowledge to draw up a good business plan so that you can find banks that are willing to help you to finance your real estate portfolio.
Questions such as: how to build it up legally or fiscally, privately or in partnership, are questions that an accountant or other adviser will unfortunately not answer for you. You should know that yourself and it will help you know what steps you need to take to own multiple properties. Once you know how everything works and how a good real estate strategy works, you have a lot of possibilities.
Be willing to work harder than the average person
The great thing about investing in real estate is that you don’t have to give up your job or business; you can just keep doing it! However, you should be prepared to spend a few extra hours a week looking for the right property, writing a business plan, going to lenders, screening tenants and so on.
If you do this consistently for a few years, over time you will replace your income with passive income. With real estate, you can arrange and organize your time yourself without having to take the risks to let go of your permanent job.
Be ready to get your hands dirty
Don’t get me wrong. You’ll get your hands dirty in terms of actual work because you can save a lot of money by buying cheap and tired apartments and renovating them yourself. You can make more money from people who are too lazy to make their home or apartment visually attractive when selling. As a result, you can buy such apartments / houses for cheaper rates because there is overdue maintenance.
By placing a new kitchen in this apartment or house, doing some painting work, renovating the bathroom, painting the facade and / or renovating the garden, you can gain experience, and you will also feel satisfied.
In the beginning, it is best to do those works yourself. Due to the fact that you did everything yourself first, you can manage others better afterwards with that experience. This way you can better estimate the prices of renovation works afterwards.
Master the basic renovation skills
What are the basic skills that you should be able to save you a lot of money? You can learn to lay a floor, nowadays you can learn to ‘pimp’ a floor with stone carpet, marble carpet or tight flexible cast floor. You can purchase the needed materials and you will learn how to install the floors yourself and thus save several thousands of naira.
Once you have mastered that, you can save a lot of money in the future. Also, follow a basic course on painting or go with a professional dye for a few days because by painting yourself you can also save a lot of money. You can even learn how to install new windows yourself.
Chances are that you buy a property where the windows are worn out. Nowadays, if you have the sizes, you can order windows on the internet and you will also save a few thousands of naira. The skills you learn will come in handy sooner or later.
You may not pay too much for a property
Novice investors often pay far too much for a property. Estate agents disguise the return, especially with new construction. Many novice investors have not made a good market inventory; they rely too much on suspicions and guesswork.
Don’t walk away from a ‘horror’ apartment or house.
Horror apartments or houses are better because the more junk, the better you can buy. Don’t walk away from a property with bad tenants or a bad neighborhood or from a property that has been vacant for years. Look beyond that.
Of course, these are not the houses that estate agents put in the foreground and that they advertise with. Go to a real estate agent and ask him what his dirtiest, ugliest monster property he has in his portfolio. You would be amazed!
Buy a property that you know you can increase the rent
In real estate investment, you can buy a house or apartment for rent, clean the bathroom, and upgrade the kitchen. If necessary, create a space, such as a basement or an attic, that can be used as an extra storage room or space. For example, remove trees from the garden to make the garden appear larger or make a carpool or parking space.
These are all points that you can use to increase rent, points that add value and that others do not really notice.
Buy super large homes and split them up
This is an effective real estate investment strategy. Homes with large areas can be split up or even added to a floor. Some beautiful mansions and town houses are a good example of this and a unique opportunity too.
Know the area, region, province and city
When going into real estate investment, its important that you understand the vicinity you’re interested in. Go there regularly for walks, cycling and so on. Make a folder with the prices, talk to brokers so that you can quickly switch if there is an opportunity or opportunity.
Don’t underestimate the power of a good network.
Building a good network is, for example, going to different brokers and passing them your search criteria. If they have something in their portfolio that meets them, they can call you. Make sure you have a good relationship with your notary and mortgage providers. Go to business network meetings and try to build relationships with these people.
Be creative and don’t give up
Don’t listen to negative people. Real estate investment deals never come naturally. You have to enforce, create, discover and see good real estate deals.
One sees a building plot and the other sees a place for 3 apartments, one sees a dirty apartment or house and the other sees an opportunity to purchase 30% below market value. One sees a neighborhood full of foreigners and / or underprivileged and the other sees housing shortage. In everything you do, you will find reasons not to do it.
Who or what are you going to listen to? To your dreams or to negative people or negative news? Think of it as a test for yourself. Are you determined enough to make your dreams of financial independence come true?
If you want to master these 12 golden rules for real estate investment, you can choose to learn from someone who knows the tricks of the trade. If you need advice so that you can achieve your investment goals faster, you can contact us for more information.