Real estate is one of the oldest forms of investment known to man.
Investing in real estate is easy and fortunes are made easily. For example, an investor decides that a desert area will eventually become an industrial development. He buys several acres at a very low price. If his assumption turns out to be correct, ten years later he sells the land for a hundred times what he paid for it, this can happen anywhere in the country and is not an exceptional case.
As the population continues to grow in the US, land prices continue to rise and it means that real estate will continue to offer one of the best investment opportunities in the country.
Compared to most forms of investment, Real Estate offers greater earning potential. Of course, not all land will be a winner and, despite the great potential rewards, in some cases there are risks, so careful study is necessary before investing.
One of the problems of Real Estate is its lack of liquidity. Liquid aids are those that are easily converted to cash, such as stocks or bonds. Most real estate investments take years before you can earn any money, so it is not advisable to tie all of your assets into this type of investment. Your financial situation will determine how much you can wisely invest in property.
There is a difference between a land speculator and an investor. A speculator buys land with the intention of making a quick sale and quick profit and will not hold land for a long period of time. An investor, on the other hand, is looking for a long-term profit and typically buys only what they can afford to hold for an indefinite period of time.
If you are new to this field, it is advisable that you refrain from any speculation until you are more informed, and you will need to spend considerable time studying and researching. It is also advisable to consult specialists before acting.
Without realizing it, you have already made a very successful investment in Real Estate if you bought your own home.
Before looking for areas to invest in, consider the condition of your own home. If you have any plans to sell it, good landscaping is known to increase a home’s value considerably.
Big profits can be made buying rundown homes and rehabbing them for eventual sale, but a few factors should be considered:
* You should know something about architecture and remodeling and have an idea of how much it will cost to get the house back in shape. Consider what you will be able to do yourself and what it will cost if you have to.
* The location of the house is the most important factor to consider. Study the neighborhood, shops, and transportation facilities.
It can also be profitable to lease land for commercial use. The land bordering the road is extremely valuable for purposes such as warehouse, gas station, etc.
Land development companies frequently post advertisements offering backcountry retreats. Beware of these offers as they themselves make a huge profit at the time they sell the land to you, making it much more profitable for you to buy yours.
When buying property, buy at a price that involves minimal financial risk. Invest only a modest amount of your own capital, when you sell, determine if a cash or installment sale is best, based on your overall income tax status. Learn by looking back at the mistakes you’ve made in the past and reviewing the opportunities you’ve missed.
Prepare a list of all available properties in your area and think about the best future use of the properties. Learn how to buy land before there is demand. Buying land well in advance is the only economical way at today’s prices. Then hold onto the property until you can resell it for a big profit. Don’t sell all your desirable properties and keep only lemons.
If you’re willing to leave the cities, you shouldn’t have a problem finding cheap land for sale. If you discover a piece of land that appeals to you but is not listed for sale, contact the Country Registry Office and they will tell you who owns it. Get in touch with him and he might be willing to sell.
As a general rule, buying land within thirty miles of a growing city is often a good investment. Deal only with qualified real estate agents. Beware of people offering quick wins.
Before taking any action, study what has been written on the subject. Learn why you should and shouldn’t buy. Stay conventional and don’t buy white elephants. Look for hidden defects and make the property attractive before offering it for resale. Study local conditions and make sure it is practical. Constantly look for bargains and quality properties with exceptional features that make it easy for you to sell. Follow up on the Sale signs, make inquiries.
When discouraging elements occur, minimize your losses by any means available. Do not waste money on repairs to badly located properties or in areas with surplus rental units.
Before you try to sell, find out how the prospect can profitably use the property. Ask yourself if you would buy it if you were in the prospect’s shoes. Ask yourself if the future use will fit any of the many specific business types. Can a hospital, bank, apartment complex, condominium or professional building be located on the property?
Learn to analyze the pros and cons of a real estate problem. Break it down into its various elements. Know if the answers you come up with are satisfying and practical. Try different approaches to the problem.
You need to look for the “top” or “bottom” of the market, or the current economic situation. You are looking for a variety of properties that have a higher value depending on their use.
There are always opportunities in Real Estate in good times and bad, but it’s up to you to choose only the best deals, especially during times when it seems that Real Estate values and demand have peaked or at times when it’s practically Impossible for most people to obtain bank loans due to tight money markets or impossible interest rates.