Investing In Real Estate? Key tips

Real estate is a reliable way to grow your wealth. However buying the right property in the right area can make all the difference. When purchasing real estate, there are a few tips that you need to keep in mind.

Before you do anything, you should work on understanding how the real estate market works currently. The only constant is change, and a successful purchase depends on an understanding of the nuances.

Timing is critical

Choosing the right time to buy can make a huge financial difference. For example, if the current market is favoring sellers (good indicators are that prices are going up and very few sellers need to discount) you may want to wait until conditions improve. Indicators of an approaching bubble are another clue that you should stay out – for instance look at the average rentals to the average real estate price, if it is unusually low beware. The Global Property Guide provides some useful rules of thumb in this regard.

Which real estate agency?

The first rule is don’t use the same real estate agency as the person that is selling your property. Since this agent was working with them initially, any deals they make could favor the seller.

Hire your own inspector / engineer to look at the property before you buy, don’t just trust the real estate agent or the seller, or even use the people they recommend. This small investment can avoid a world of pain later on, although obviously you’d only want to do this with houses that have passed an initial screening.

When choosing a real estate companies go on overall reputation and any personal recommendations you can get.

According to Smart Asset these are the leading real estate companies to provide you with a starting point:

  • RE/MAX
  • Century 21
  • Keller Williams Realty, Inc.
  • Coldwell Banker
  • ERA
  • Sotheby’s International Realty
  • The Corcoran Group
  • Camden
  • Better Homes and Gardens Real Estate
  • Zillow

Area analysis

Analyze the area before jumping into a purchase. It may seem superficially attractive on the surface, but further investigation may change matters. You should be looking at schools, distance to malls and hospitals, crime rates and natural disaster history.

Perhaps an oddball consideration, but look at the National Sex Offender Registry to see how many predators live in the region. While there will be some in most regions, you may not wish to buy a property that is right next door to one.

Personal versus market preference

When you invest in real estate, you need to focus on the preferences of a prospective future buyer and less on your own preferences. This might be hard to do, but is necessary to avoid ending up with a property that is hard to resell. A classic example of this was detailed in a documentary by ABC. For example, if you purchase a Roccoco home styled as though it belongs in 17th century France, watch out it might not be to everyones liking. Simplicity and minimalism as easier to resell, and to rework if necessary later.

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5 comments

  • Zoe Campos

    Thank you for reminding me that I should always analyze and check the area of the property I’m currently eyeing before proceeding with the purchase. However, my husband and I are looking for properties in Phoenix, AZ and we will not be able to personally come and check the house for ourselves before the official moving day. Maybe a 3D Matterport real estate tour provider might be helpful in providing an overall look, although virtual, to possible buyers like us.

  • Zoe Campos

    My friend had encouraged me to invest in commercial properties but I’m not sure yet if I have the required experience and knowledge to venture in this field. Thank you for reminding me that I need to understand the market thoroughly before purchasing any kind of property. I’ll try to see first if it’s better to start with commercial real estate properties or settle with residential ones.

  • Penelope Smith

    I have been considering getting started in real estate investment. It is great to know that I need to consider the timing of when to invest. Personally, I would want to get a professional to help me know when to look to buy those investment properties.

  • ปั้มไลค์

    Like!! Great article post.Really thank you! Really Cool.

  • Zoe Campos

    Thank you for reminding me that I need to set aside my own preferences when buying a real estate property and instead focus on something that future potential buyers will prefer. The property next to our house had been increasing in price as the years go by so my husband and I realize that it would be fun to explore the same market and enjoy better profits. Still, we are considered beginners in this field, so it might be a good idea to talk to an expert first and ask about terms we’re not familiar with like the passive investing service in real estate.

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