Basic Real Estate Investment Strategies
There are some basic strategies that apply across the board no matter where you are investing or what the current economic conditions are.
Understand what the investment is going to do for you. Provide income? Tax write-off? Future appreciation?
Do your homework on the stability of the area, crime rates, demographics and/or work with an experienced broker that you trust and with whom you have a good rapport.Always maintain cash reserves and/or have a credit line to handle unexpected expenses.
Never allow yourself to have to sell a property. You do not want to be a needy seller in a down market – you want to be a prepared buyer.
Plan, plan some more, and then plan again. A major key to successful investing is recognizing what you want to accomplish, then set goals as to how you are going to get there. Life styles and goals will change over time, at which point you’ll need to reassess your plans and make adjustments.
ALWAYS hire a qualified professional to take care of property management and other important services. Anytime you can hire someone to do something for less than you make per hour in your current career, you should do so.
Maintain adequate insurance, both on the property as well as liability insurance. Check out an Umbrella policy.
Maintain accurate records. Have your files in order both for liability issues and an IRS audit.