Key Tips for First-Time Investors

Here are a few things to consider before buying your first investment property.

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Which tips do you need to remember to start off on the right foot as a first-time home investor?

First, you’ll notice that I say “home investor” instead of “homebuyer” because I don’t think you should own your first investment property before you own your first home. Therein lies my first tip. Owning your own home before buying an investment property can teach you a lot about what can go wrong, how to fix things, what you are (and are not) capable of doing yourself, etc. Don’t put the cart before the horse and start buying up investment properties while you’re still paying someone else’s rent. 

Next, start small. Far too many people try hitting a home run with their first real estate investment and end up striking out. Continuing with our baseball parlance, just try hitting a single. Get a rental property you can manage yourself so you can learn how to screen tenants and identify ways you can increase rent. It’s a low-risk, high-reward opportunity. If you screw things up, you can probably correct the situation without it costing you too much. Additionally, the property can appreciate greatly over time and give you ample tax benefits.

      Once you buy your first rental property, you have to treat it like a business.

As time goes on, you can branch off into buying multifamily properties, commercial properties, more individual units, or start flipping homes. First, though, start small and build from there. Being a real estate investor is, in essence, its own separate business. As you gain more skills, you can grow your portfolio. 

Last but not least, hire a team of professionals. You need a team of property managers, real estate professionals, and contractors you trust to help you. Before buying any rental properties, you need to know who’ll be working on them, managing them (if you’re not), and offering you legal advice so you can successfully run your real estate investment business. Again, once you buy your first rental property, you have to treat it like a business. You have to give it its proper due by ensuring it’s properly managed by a group of professionals. 

If you’d like to know more about buying your first investment property or have any real estate needs I can assist you with, don’t hesitate to reach out to me. I’d love to hear from you.

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