4 Investing Must Do’s for a Successful Real Estate Business
harkins / May 3, 2017
Real estate investment is an attractive business opportunity with potential for large returns. Even with lucrative possibilities, don’t underestimate the risk and necessary legwork. Whether you’re a beginner or a seasoned player in the business, there are some things you must always do for a successful career as a real estate investor.
Look Deep Before You Leap
In other words, take time to learn the business before throwing in your hard earned dollars. In business, there are times when you have to just dive in there. In the case of real estate investment, you must dive wisely. You’re investing to make a profit, not to frivolously give money away. If you’ve been patient enough to accumulate money to invest, stay patient through your learning curve.
Do detailed research on the properties you’re interested in. You should start with knowing information about the location, the property’s age, and how much work the property needs. Another important detail about location is pricing in the area. This can give you an idea of whether demand is high or low from potential tenants in the area. Learning about area pricing will also help you understand how much you should pay based on the property and location.
The learning process will continue for as long as you’re in the investment business. Read often to keep up with the latest market trends, new properties, resources, and other investors. Attend seminars and workshops to stay informed and educated so you make smart investment decisions.
Have your Personal Finances in Order
As a real estate investor, it’s important to have a good handle on how to manage money. You’re a business owner, so you need to know how to properly allocate funds. If you’ve decided to invest, you’ve taken the first step by saving or acquiring initial funding. Now it’s time to build on what you’ve done financially.
Create a habit of keeping personal funds and expenses separate from business financials. While making it easy to distinguish funds, continue good financial habits with personal funds. Keep your expenses low and income high.
Getting the funding you need to purchase property requires a decent credit score too. In the beginning when you haven’t established a business credit score, your personal credit report is a critical instrument to qualify for mortgage loans. A good score is in the mid 700 range. Make sure you’re paying bills on time, keeping credit cards below 50% usage, and doing everything you should to minimize blemishes on your credit report.
Have Basic Business Finance Knowledge
On the business side, you need to have a few sound financial skills too. Backtrack to your basic high school and college math skills. Working to convince clients and complete contracts requires some basic financial calculations.
To keep up with what’s coming in and going out, you need good bookkeeping skills. It’s best to hire an accountant or outsource your business financial responsibilities. Professionals can help you with the best options for filing business taxes, best practices, and give property tax advice.
If you’ve done well with saving money and managing your spending in the past, you should have no trouble. Just continue to maintain the same good habits as your business takes off. Build on your financial knowledge and keep making good habits as the business grows.
Make Networking a Part of Your Job Description
Make a habit of connecting with people on all levels. You never know when you’re sitting next to your next tenant, employee, or financier. You might even come across a good property management company.
It also helps tremendously to pick the brain of those who are already in the industry. They can help you with the learning and connection process. It might save you time and headache. Business owners in general are good to know and keep in touch with. Network online through social media, but also in person. You can schedule time to attend events or just naturally connect with people during activities in your free time.
Many people have made a solid business of investing in real estate. They didn’t do it overnight, and they didn’t do it alone. If you do your due diligence, master financial matters, and stay connected, you can make a long-term living in the business too. For more investment advice or help with your real estate business, visit http://www.harkinscommercial.com/
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