A positive outlook goes a long way and is the first place to start when deciding you wan to buy an investment property or really anything you set your mind to. Don’t be intimidated about buying your first rental property. Instead, take action so you understand all aspects of investing in real estate.
If you're in a position to buy an investment property then you should feel confident about the future holds. For one, you've hopefully paid down any debt on credit cards and have a fair amount of money saved.
Secondly, even if you don't end up buying your first investment property this month or next, perhaps a year from now a house or condo will come available that's just perfect and you'll have a good understanding of how the real estate market works and be ready to buy the property.
- ask questions and then more questions
- do your research
- network with other investors
- let your friends know what you’re looking for
- attend a real estate conference to get your feet wet
- know what kind of investor or property owner you want to be (hands on or hire a managerment company)
There will be ups and downs in the real estate market, as the doc com bust of the 1990s will tell you and the most recent real estate crash and subprime crash in 2005-2006. So, be prepared for real estate cycles and plan accordingly. For instance, allot a certain amount of money for possible vacancies and repairs, but most importantly, buy a property where the price is built in so you can afford to take a hit at times.
If you're already buy a property that's over valued then you'll have to wait much longer for the real estate down turn to catch up. Don't rush into buying an investment property but be confident since you've done the research, looked at recent homes that have sold in the area and know what the outlook is for the city and neighborhood.
If the demand for rentals in the area is high then your concern with the price of the property overall doesn't have to matter as much. You're not looking for an increase the the value of the property but a long term renter who will pay a price that works for your numbers - the loan your taking on, the taxes, the upkeep an so on.
Start your research here with various tools that give you data to work with, from job rates to population growth.
But remember, have the can do type of attitude rather than the one that thinks the sky is falling or there's no way you can do this. Slowly but surely as you ask more questions, do your research and reading, you'll start to feel more comfortable in your real estate investing journey.
Insider tip: One of the greatest things about delving into the investment properties area is what you learn not just about property, but about yourself, business, and others. Take the experience as one of the assets you gain by getting into the real estate business.