Thoughts about Real Estate Investing for Beginners Are you looking to get involved in REAL ESTATE INVESTING but you’re a beginner and really don’t know where to start. Now I know there is an awful lot of hype surrounding the business of real estate investing. Many claim to have the” secret” for overnight riches. I’m here to tell you that there are no” secrets”. Real estate investing needs to be treated like any other business venture. It takes time to build a business and real estate is no different. Investing in real estate is not a get rich quick scheme. You can attain fabulous wealth, but it won’t happen overnight!
As a beginner, you’re probably overwhelmed with information overload, not knowing where to even begin. Just slow down, educate yourself on the basics and take action. Let everyone you know what you’re up to. Opportunities will present themselves in various ways from unlikely sources.
There are literally dozens methods, techniques and business plans within the exciting world of real estate investing. Your goal as a beginner should be to identify the method that best suits your needs, circumstances and abilities. As they say” there’s more than one way to skin a cat”. So it is with real estate investing, there’s more than one way to invest.
OUr job as real estate investors is one of problem solver. Come up with a solution to a problem that meets the needs of all parties in the transaction and you will be a success.
I want to start with an overview of some of the methods or techniques that a real estate investor might use. The circumstances of the deal will dictate the method. I won’t go into detail about the methods in this article. I simply want to get you thinking about them and how each method might be used to solve a problem. This article is just the start and will only include a few of the methods, but we will cover more in future articles.
No better place to start than with foreclosure investing given the current market that we are experiencing. Investing in foreclosure real estate in simple terms, is going down to the courthouse steps and bidding on a home at the foreclosure auction. Seems simple enough. Well don’t run out buy a property at auction. We’ll get into the specifics in another article.
Now I’ll back up a little with pre-foreclosure investing. Investing in pre-foreclosure real estate is when you buy a property that is in default, before it actually goes to auction.
Moving ahead, an REO or” Real Estate Owned” are properties owned by the bank. The bank ends up with the property when they don’t sell at the auction.
Short sale real estate are properties that are sell for less than what is owed on the mortgage. Banks are willing to accept less than the amount owed under certain circumstances. It just so happens that the” perfect storm” circumstances are occurring in real estate at this moment. A huge inventory of homes has placed downward pressure on home values. Many homes are now worth less than the mortgage owed. A large percentage of homes purchased in the last 2-5 years were financed with variable rate mortgages. These mortgages are resetting, borrowers can’t afford the payments so more homes are being dumped on the market creating further downward pressure on prices. A nasty cycle in the real estate market for sure!
I need to wrap it up for now but there will be plenty more to come. You can visit the Real Estate Investing for Beginners Blog here for more information on investing in real estate. The blog is new so check back often as I will be adding new information regularly.
Good investing!.
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