Back in 2006 and 2007, real estate investing allowed investors to generate huge profits in a very short time. During those times, there was less competition and the banks were more lenient with their underwriting guidelines. The market is now flooded with investors and “wanna be” real estate investors. There were many fix and flippers that were hard hit because they were one trick pony. They learned one strategy and rode that until they were bucked by the changing real estate market.
Today’s real estate investor must be educated and savvy in varying entry and exit strategies. It is critical to the success of today’s real estate investor to understand the power of leverage. The key point to any successful business is timing. I have heard people say they are waiting for the market to recover before they invest in real estate. Gong! Why is it people will take off work to attend a pre-Christmas sale, but when real estate is on sale(for the low low), they want to sit on the fence.
Despite the economic downturn, properties have continued to increase in value. The only reason why investors were scared to invest during recession is because of the uncertainty in the trends of the market. People without control are reactive and tend to be the worker bees for employers. If you were to examine the historical trends of the property market: NAR records show that property values have increased 0ver the past 40 years with the exception of the past 2 years. The correction had to occur as people were over paying from properties on massive scales. Properties were listed on MLS for $200,000 and people were righting contracts for $220,000 retail.
Real property investing is indeed, one of the safest ways to make money. There are two ways to make money in the real estate. One is through rental income (passive) and the other one is through the sale of properties. Today’s real estate market presents some challenges when you use 2 or three strategies. However, becoming educated on at least 10 different strategies creates profitable opportunities for your real estate business. Examples of property acquisition strategies include: wholesale, probate, REO, short sale and auctions to name a few.
Successful property investing will require you to have enough knowledge to understand the varying ways of financing your real estate purchases. Do you want to become a real property investor? With the right strategies and techniques, you can generate wealth in a few years. One of your biggest assets will be a well seasoned buyers list. To greatly reduce your risk in investing a seasoned buyers list is essential.