Real Estate Investor: A Comprehensive Beginner Realtor's Guide to Evaluating Deals, Market Focus, and Property Buying

By Blaine Robertson

Are you ready to be a billionaire? Do you yearn to earn exclusively passive income? Are you prepared for your retirement years?

Real estate investing gained popularity as a form of investment that can help one in generating income and securing their current and future life. A number of people consider it a simpler and easi

• Language: English
• Publisher: Cathrine Kowal
• Release date: Sep 1, 2023
• ISBN: 9781088297803

Book preview

Introduction

Investing in real estate usually means that your goal is to make money, both now and in the future. It is a wonderful way to ensure that there will be money in your future once you have gotten your investments up and running properly.

When set up properly, you will be making enough profit to be able to cover the risks that you are taking in purchasing new houses to rent out or sell for profit as well as the cost of owning the property like the insurance, utilities, and other necessities.

Once you understand the basics, you will be able to invest and make it as easy as playing a game of monopoly with your family.

Real estate is considered to be an alternative investment class all together. When you begin to invest in real estate, you will have a portfolio that will show all of what you have done as far as your investments go. Your portfolio will have several different qualities that will be able to enhance the return with a larger portfolio or even be able to reduce your portfolio risk on the same level of return.

You will learn about the types of investment, how to identify rental properties, house flipping, property evaluation, and the appropriate team to employ. Additionally, you will understand the mistakes to avoid among other topics covered in this book. Read on to enjoy more topics.

Chapter 1

The Basics of Real Estate

House, Home, Residence, Real Estate, Building

It seems that you are interested in the fast-paced world of real estate. However, before you begin, you have to know exactly what real estate investing is, and what all goes into the process. You really have to be sure that you are prepared for this specific industry, because if you are not properly prepared, then you might need to spend a little more time getting ready. This is an industry that can make you rich, but it can also cause some serious financial drain if you are not ready for the whole ordeal. 

This book is here to help you as you embark on the adventure of real estate investing. When you try to go out into the world, you feel like you are alone most of the time. This book will help you feel less alone and misguided by giving you the information that you require to complete each day with more and more progress. When you are trying to start your journey into the world of real estate, the beginner level is actually the most difficult. You have so much to learn, and you have to do well the first time, especially because it is the precursor to your investment potential. 

This industry is a lot different than many other investing platforms. It is not as cutthroat, but it is still a make it or break it kind of business. It also can take a good chunk of change to start up. It all depends on your area and the kinds of deals you can find. If you know where to look, then you can definitely ensure that you get the best deals out there, just keep your eyes open.

I know what you are thinking, You haven't yet gotten around to telling me what exactly real estate investing is. And you are exactly right. However, I am getting there now, just needed to prepare you so that you know that even though it sounds easy, and it can be easy, it does take time and effort, along with money. 

Real estate investing is the process of buying a house for the lowest price possible, fixing it up and adding value to it, then either selling the house for a profit or renting it out for a steadier income (Fundrise, 2019). When you are renting a property, you become a landlord, and the people who rent from you are known as tenants. You, as the landlord, have a steady income coming in, while your tenants have a nice place to live where they don't have to pay property taxes or deal with registering a deed. 

This is different from the other ways of investing because no other investment platform allows you to earn a steady income and make as much profit as you can with renting. If you are smart with your money, you can make almost a 75% return on your investment over time. However, investing in real estate does often take longer to build up to where you make it past breaking even. With other investments, it may take some time to see a return, but with real estate investing, it can take years. Also, with real estate investing, you do not have to sell your investment to start making money. You can keep your investment and still make money off of it. That is the greatest thing about this platform. Then, when you are tired of being the one responsible for it, and you have made more money than you could have imagined off of your initial investment, you can sell it which could even give you more money than your rental income did if inflation has occurred in the market. There are so many advantages in this industry that many people often overlook the cons.

If you are asking yourself, Why should I invest in real estate? You again have come to the right book to get your answer. This would not be a book for beginners if we did not answer that question, or at least give you a little more clarity, so here are some reasons why you should invest in real estate.

There are many more reasons out there for investing, but some are more specific than others, so only the basic ones are listed. Try it for yourself to see why it is such a great idea. 

Now that you know what real estate investing is, the pros and cons, and why you should invest, if you are still reading, I assume that you want to continue on your journey. Now we give you the tips and tricks for becoming a success. These tips and tricks will help figure out what it is that you need to do, and how to make it big. 

Ways to Profit from Renting Out Real Estate

Investing in stocks offers only one avenue of receiving revenue and this is dependent on the stock’s appreciation value and your knowledge of the opportune time to sell the stock. There are more ways than one to turn a profit from income-generating real estate. 

Here are a few to consider:

Income generated from rentals.

This one needs no further explanation. 

Buy a property with a low market value

Buying low is a widely practiced method. You can make a quick profit from selling real estate for more than you paid for it. Properties with a low market price tag include foreclosure. Of course, this method is made even more profitable if you have the required negotiation skill set.

Increase market value

Any improvements to the property increase its market value, allowing you to sell high. Unlike stock prices that are determined by the economic market, you have the choice of making improvements to raise property value for higher returns.

Improving equity

Every mortgage repayment you make towards your property rental increases equity value.

Smaller property rental units can yield more returns than a larger single unit

By dividing one large sized house into different units you can rent these units out to a number of individual tenants and receive a larger sum in rent than by renting the house to a single family. 

Rent out to businesses

The market places a higher price tag on property rentals to businesses. The best commercial client is an established business. 

Refinance property to improve cash flow

You can increase cash flow from property investment through refinancing. You can get more money into your pocket if refinancing allows for a decrease in mortgage repayments while the rental income you receive remain unchanged. The excess in cash flow received can be put towards the deposit for purchasing an additional property or can be saved for improvements or maintenance.

Your success in income-generating property rentals depends on you

You are the critical factor in how well you do. You choose the area to purchase in, the type of property you want to rent out, the type of tenants you want to rent to (do you choose families or single professionals). Do you choose to buy a ready-to-move into property or a fixer-upper as you’re so handy when it comes to property D-I-Y? Do you manage and maintain the property yourself or do you outsource this to a property management company? How proactive are you in marketing your rental property to find the best tenant?

Even during economic turmoil, there are still advantages to owning rental property

Troubled economic times may not be all bad news for the property investor. There are potentially more people looking to rent having lost their homes to foreclosure and people being denied mortgage applications. And when