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    Investing in Real Estate for Beginners
    Investing in Real Estate for Beginners
    Investing in Real Estate for Beginners
    Ebook214 pages2 hours

    Investing in Real Estate for Beginners

    By Jason A. Welch

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    About this ebook

    LEARN HOW TO INVEST IN PROFITABLE RENTAL PROPERTY AND MAXIMIZE YOUR RETURN FOR NEW REAL ESTATE INVESTORS!

    Investing in profitable real estate rental properties can, at first, seem daunting. But with the information provided in this e-book, you should be able to begin investing in real estate rental properties better equipped than when you first began to read it.

    This book will answer all your questions on real estate investing.

    This book contains:
    • Types of Real Estate Investments Properties
    • Real Estate Investment Options
    • Understanding Return on Investment (ROI)
    • Top Features that Make a Profitable Real Estate Investment
    • Being a landlord
    • Tax Tips in Real Estate Investment
    • Mortgages in Real Estate Investing
    • Common Mistakes to Avoid While Investing in Real Estate
    •  Protecting Your Investment    

    Real estate investing is actually much simpler than you realize! It certainly helps to have the right team on your side, especially when you're not exactly sure what you're doing. Basically, having the right team means the difference between failing and succeeding. You'll learn exactly why rentals make the best investments, which property types are best for renting out, and why location matters so much. Your success relies on having tenants so you need to consider what those tenants are looking for and how to provide it to them. Different properties do well in different types of locations; a multi-family home might not do as well in the city as it would in the suburbs. It is always wise to bear in mind that being tactful in the real estate business gets you amazing deals without having to spend a lot. Build your financial future with passive income in rental properties!​

    Who this book is for:
    • Anyone who wants to build their wealth
    • Anyone interested in real estate investment for residential rentals

    LanguageEnglish
    PublisherJason A. Welch
    Release dateFeb 10, 2020
    ISBN9781393431299
    Investing in Real Estate for Beginners

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      Book preview

      Investing in Real Estate for Beginners - Jason A. Welch

      INVESTING IN REAL ESTATE FOR BEGINNERS

      LEARN HOW TO INVEST IN PROFITABLE RENTAL PROPERTY AND MAXIMIZE YOUR RETURN FOR NEW REAL ESTATE INVESTORS

      Table of Contents

      Introduction

      Chapter 1: Real Estate Investing for Beginners

      How to go about Real Estate

      Real Estate Investor mindset and behavior

      You must invest without collecting.

      Have plans for upkeep.

      One at a time.

      Focus on the environment.

      Hire a mentor.

      Protect yourself claims.

      Maintain good bonds.

      Ways That Real Estate Investors Make Money

      Cash Flow Income

      Appreciation of Value

      Supplementary Investment Income

      Real Estate-Related Income

      Rewards of Real Estate Investing

      Diversification

      Higher cash returns.

      Monthly cash flows.

      Limited near-term taxes.

      Long-term income.

      Permanence

      Chapter 2: Types of Real Estate Investments Properties

      Turnkey Property

      Residential Properties

      Individual Retail Properties

      Flipping Houses

      Larger Retail Complexes

      Office Properties

      Industrial Properties

      Vacation rental

      Commercial Rental

      Chapter 3: Real Estate Investment Options

      Buy and Hold

      Fix and Flip

      Real Estate Investment Trusts (REITs)

      Crowdfunding Investment Options

      Chapter 4: Understanding Return on Investment (ROI)

      The 1% Rule

      The 50% Rule...........................................................................................................2

      Expenses Involved in Your Property

      Definition and Calculation of Return on Investment (ROI)

      Other Non-Financial Factors Affecting ROI

      Chapter 5: Top Features that Make a Profitable Real Estate Investment

      Neighborhood

      Rent

      Property Taxes

      Job Market

      Schools

      Amenities

      Crime Rates

      Natural Disasters

      Future Developments

      Chapter 6: Tips on How to Choose Your Tenants

      Follow the Rule of the Land

      Be Patient

      Widen Your Search

      Choose Tenants with Good Credit Ratings

      Do a Criminal Background Check

      Check out the Tenant’s Rental History

      Choose a Stable Tenant

      Two People Per Bedroom

      Be Open-Minded

      Don’t Get Overly Friendly with Your Tenants

      Listen to Your Instincts

      Chapter 7: Understanding Property Valuation and Guidelines to Decide You Are Selecting the Right Property

      The valuation

      How to Know That You Are Selecting the Right Property

      Know people and talk with them.

      Determine the amount you would wish to borrow.

      Visualize the ideal renter.

      Avoid doing more than is necessary.

      Estimate the amount you will be earning from rent.

      Count all your expenses.

      Think about your property’s appreciation.

      Determine your choice property’s cash-on-cash return rate.

      Evaluate your rate of capitalization.

      How You Know That You Have Found the Right House

      You have an urge to go inside.

      You feel embraced the minute you walk in.

      Being in the bathroom does not give you an odd feeling.

      You begin to visualize how you will arrange your furniture.

      You see yourself painting your ideal color on the walls.

      Your basic needs are met.

      You feel that you no longer want to look at other properties.

      You are on the edge of your seat, waiting to tell others about what you found.

      Every thought that comes to your mind convinces you further that you need to do something about the house.

      Chapter 8: Being a landlord

      Hire a property manager

      Find a lawyer who knows the real estate business

      Learn your leases and your tenants

      Learn your property

      Satisfy your customers

      Don’t go cheap.

      Never stop learning

      Chapter 9: Tax Tips in Real Estate Investment

      Interest

      Depreciation

      Cost of Repairs

      Travel

      Wages of Employees and Independent Workers

      Insurance Payments

      Leverage the Power of 1031 Exchange

      Chapter 10: Real Estate Market

      Rural Markets

      Urban Markets

      Suburban Markets

      General Concept of Real Estate

      Local market

      Long-Term needs

      Chapter 11: Mortgages in Real Estate Investing

      Adjustable Rate Mortgage

      Government-Insured Mortgages

      Balloon Mortgages

      Fixed Rate Mortgage

      Chapter 12: Real Estate Trading

      Wholesaling Real Estate

      Properties You Could Wholesale

      Finding Wholesale Deals

      Why You Should Be Venturing into Real Estate Wholesaling

      REITs Investing

      How REITs Work

      Advantages of REITs

      Chapter 13: How to Turn Real Estate into a Long-Term Business

      Embrace the Humble Start

      Go Big

      Understand the Market, and Get a Mentor

      Prioritize Learning Against Earning

      Make Your Mark Immediately

      The Returns Are in the Purchase

      Keep Time

      Your Intuition Matters

      Chapter 14: Common Mistakes to Avoid While Investing in Real Estate

      Rushing into a Deal

      Overthinking on a Good Deal

      Thinking that Real Estate Investment Will Get You Rich Overnight

      Relying Excessively on Real Estate Agents

      Underestimating Purchasing and Renovation Costs

      Not Doing Debt Management Wisely

      Not Keeping Aside Money for Repairs and Maintenance

      Planning on the Go

      Thinking You Can Manage Everything on Your Own

      Underestimating the Cost of Renovations

      Failing to Have the Right Community Around You

      Failing to Do Your Homework

      Avoiding Due Diligence

      Lack of a Backup Plan

      Paying Too Much Money

      Failure to Consider Soft Costs

      Forgetting That It Is the People Who Are Most Important

      Borrowing from Friends and Family

      Failure to Use a Good Local Broker

      Restricting Yourself to One Housing Market

      Not Having Backup Exit Plans

      Giving Up Early

      Chapter 15: Protecting Your Investment

      Maintain the property

      Insure against loss

      Establish legal protections

      Share the financial burden

      Pay attention

      Chapter 16: Making Your Real Estate Business Passive

      Engage Professional Property Management

      Real Estate Partnerships

      Consider Turnkey Real Estate Companies

      Conclusion

      Introduction

      The best real estate investors are those who keep their ear to the ground when it comes to new avenues for lead generation and changing buyer or renter trends which means they cultivate the habit of lifelong learning as early as possible. Failing to do so is like leaving money on the table. Getting ready to pick out your first investment property is akin to getting ready to start out on a great adventure. No great adventure that ends profitably is over quickly, however, which means that before you get started down the path of real estate investment you need to be ready to commit to the long haul. Successfully investing in real estate is a marathon, not a sprint, and slow and steady wins the race.

      Doing the research, setting up budget goals, and learning about the areas where you would like to invest are keys to achieving success. Networking with real estate professionals and studying the trends in a neighborhood will make for a strong, profitable investment.

      Investing in profitable real estate rental properties can, at first, seem daunting. But with the information provided in this e-book, you should be able to begin investing in real estate rental properties better equipped than when you first began to read it.

      This book will answer all your questions on real estate investing.

      Chapter 1: Real Estate Investing for Beginners

      Investing in real estate is another method of putting your money to work today and allowing it to grow and multiply as time goes. For the investment to be worthwhile, though, the returns or the profit you get from your investment must be able to cover the taxes imposed on the property, the maintenance costs, insurance, the risks taken, and the costs of other utilities.

      The concept of investing in real estate is quite simple. First, it requires a basic understanding of the nature of the investment economics involved and the risks you will bear when you invest. To make a profit, you must invest in properties, collect rent, and manage the money you get so that you can invest it in other businesses as well. Note that simple does not mean that the real estate business is easy. It is marred with risks—ranging from minor to large disasters that could make you lose your property or even worse.

      Although there are risks involved, real estate investment remains one of the most popular and most lucrative investment ventures because of its straightforward approach. The business comprises a fair exchange between a property owner and the property user. As long as the user pays rent and as long as the owner ensures that his property remains safe and with a proper connection (electricity and water, although the renter pays the bills), the deal is sealed. However, there may be added complexities depending on the type of real estate investments such as commercial, industrial, residential, and the kind that trades on stock exchanges called REITs (Real Estate Investment Trusts).

      How to go About Real Estate

      The concept of real estate investing has been around for generations. Some people think that it is just about buying and selling property. That is technically an important aspect of the field, but unlike other investments, you have some sense of control over what you hold. The variables that can directly impact the real estate market can be significant. If the real estate market is up, some strategies work fine and then in down markets, other techniques become more profitable. Regardless of the market, you can make money investing in real estate. Becoming a real estate investor require few items: laptop, printer and phone. This is all the equipment you need to begin. You can work from home, what many call laptop lifestyles. It's a very low-budget investment, compared to starting any other physical business which usually requires other kinds of startup investments, like offices, staff, companies, etc. And launching a real estate investing business is far simpler than starting the majority of other businesses: it does not require venture capital, a board of directors or even a detailed business plan.

      Investing in real estate does not have to be a full-time activity. You can invest on the side, in your free time, but you may enjoy it so much that you may want to do it full time. You do not have to quit your main job to

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