Many folks dream of becoming real estate investors, but not
everyone has what it takes. If you're dreaming of becoming an
investor, here are several important questions to consider,
long before you buy your first investment property:
1) Why would a homeowner sell a house at a bargain price?
Many things happen in people’s lives that make their home
suddenly become a burden. Loss of income, divorce, or illness
are the most common, but sometimes a homeowner dies, leaving a
home that none of their heirs wants. In any case, the home has
become a problem, which is where you, as an investor, come in.
The homeowners, or the heirs, have a problem, and you must
find a way to offer a solution.
2) What types of houses should you look for?
Besides being owned by someone who no longer wants or can
afford to stay in a property, you want to find a home that’s
only tired, and not in need of structural work in order to
favorably compete with similar houses on the market. We call
that type of house a "doghouse."
3) How do you find doghouses?
Your real estate agent can scan the MLS listings, looking for
fixer-uppers, handyman specials, or as-is houses. You can also
find similar properties yourself, using the local newspaper or
shopper.
4) Should you try to close quickly?
This is an important step in becoming successful, because
beleaguered sellers will almost always be in need of money in
as short a time as possible. Get yourself prequalified and
preapproved for a loan, so you can close on the property
quickly. Being able to let sellers know they'll get paid fast
will consistently net you more houses than your competition.
5) How do you flip houses fast?
Find ugly homes, in good neighborhoods, that need as little
work as possible. Clean them up, paint them inside and out,
and install a neutral shade of new carpet, and you should be
able to flip the home in a short amount of time. Always keep
your limitations in mind. Hiring professionals for repairs
will cut into your profit margin.
Asking yourself these questions will help get you started in
your real estate investment career, and keeping these answers
in mind at all times will keep you from making costly mistakes
as you buy and sell investment properties.
(c) Copyright 2004, Jeanette J. Fisher. All rights reserved.
Professor Jeanette Fisher, author of Doghouse to Dollhouse for
Dollars, Joy to the Home, and other books teaches Real Estate
Investing and Design Psychology. For more articles, tips,
reports, newsletters, and sales flyer template, see http://www.doghousetodollhousefordollars.com/pages/5/index.htm
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June 2:
