The Real Estate Investors Guide
Real Estate Investors Guide: When you speak with seasoned real estate investors you often find that a large percentage of them do not ever invest in raw land. Typically newer real estate investors purchase single-family homes to flip, rent out or sell wholesale to a rehabber. Those investors who have been in the business for a long time often have ventured out into dealing in multi-family homes and apartment buildings to help beef up their investment portfolio. However, investing in raw land can be very profitable if you do it correctly.
In the past, most real estate investors shied away from raw land because there are no federal income tax deductions available for it, raw land generally doesn’t generate any income during the time you are holding it, development of the land requires navigating the permit process, and raw land can often take many years to sell which makes it a very illiquid investment.
Despite the negative issues which can accompany investment in raw land, there are many times where investment in raw land can be very profitable. For example, if you choose to invest in land located in an area with a lot of future growth potential and you can afford to hold on to it for a few years. By doing this you can place yourself in the position of being the owner of land that is very much desirable to developers and thus can fetch a nice price if you agree to sell it to them at some later date.
Another popular way to make a lot of money with land, and not have to hold on to it for such a long time, is to purchase a large parcel of land and then subdivide it into smaller parcels which can then be sold. Most people on the market for raw land are looking for places they can use to build a home or farm on. If you are able to purchase a very large parcel of land, much bigger than most people are looking for, and then split it up and sell it in parts, you can command a much higher price per acre for the same land that you purchased for a much more reasonable price because of its sheer size.
As you can see, it is very possible, and a smart move, to invest in raw land to increase the value of your portfolio. If you can discern where growth and building will happen in the next few years then buying and holding property in that area can be a great thing to do. However, you also always have the option of purchasing larger parcels of land and then subdividing them for individual sale at a higher per-acre cost. Whichever option you choose, as long as you are careful and knowledgeable about the area you purchase the land in, you should make money.
How to Build a Real Estate Business
It’s not exactly easy learning how to build a real estate business, but the rewards can be tremendous. Life-changing. Wealth altering. One of the common problems faced by entrepreneurs looking to build a real estate business is figuring out the ‘how’ perhaps it’s better described in terms of ‘how’ do you do it, followed up by ‘what’ do you do to build a real estate business.
In that regard, there are a few relatively simple steps to follow that first start out with a question. Precisely ‘WHY’ do you want to learn how to build a real estate business?
If you come up empty-handed – or worse still, say you just want to get rich quick – then go elsewhere…because the reality is that if you don’t know why you don’t have enough ‘chutzpah’ to cut it whenever a challenge arises. These types of people when faced with a potential obstacle get easily frustrated, then cut bait and run.
Similarly, anyone looking to jump on the next ‘gets rich quick’ bandwagon is an opportunist. And opportunistic minded entrepreneurs never focus on doing one thing great, typically meddle in something for a few days or few weeks at best, then as the next obstacle pops up – or if they haven’t done a deal in 30 days – they throw in the towel and go elsewhere.
So how to build a real estate business that dominates and crushes your competition? It first begins with an understanding of what is a real estate investor, and what investing in real estate really means.
Since there’s no dictionary definition for this one, I’ll give you my interpretation. A Real Estate Investor essentially is a problem solver. This is an individual – or group of individuals – seeking to solve the real estate needs of others, in a courteous, respectable, and enlightened manner. As a result of successfully solving the issues at hand, the real estate investor profits both within their heart and with their wallet.
Typically, the financial rewards of being a real estate investor far exceed those of the average corporate or hourly wages of many. This is a lucrative profession, but when you’re building a real estate business, it requires persistence, confidence in one’s abilities, positive attitude, and ethical practices in order to truly profit in an ongoing basis.
From my corporate background, I recognized there were 6 Pillars of Successful Businesses that all had to be in place in order for someone to succeed. They are:
1) Vision & Planning
2) Specialized Knowledge
3) Applied Strategy
4) Mentorship & Advisors
5) Strategic Partners
6) Systems & Processes
I’m sure this looks daunting to you, yet if you chunk down these 6 Pillars into bite-sized chunks, within two weeks you’ll have the strategic elements in place to go out and dominate in your marketplace. Because in order to build a real estate business that succeeds, and scales exponentially, these elements are critical and imperative to helping you generate a 6 figure bank account and realizing 7 figure gains in as little as 7 months, part-time.
How Do You Approach A Real Estate Investor?
- Make a Plan. Real estate investors must approach their real estate activities as a business in order to establish and achieve short- and long-term goals.
- Know the Market.
- Develop a Niche.
- Encourage Referrals.
- Stay Educated.
- Understand the Risks.
- Invest in an Accountant.
- Find Help.
How Do Beginners Invest In Real Estate?
- Buy REITs. REITs, or real estate investment trusts, allow you to invest in real estate without the physical real estate.
- Use an online real estate platform.
- Invest in rental properties.
- Fix up and resell properties.
- Rent out a room.
What Is A Real Estate Investors Salary?
The average Real Estate Investor salary in the USA is $100,000 per year or $51.28 per hour. Entry-level positions start at $15,000 per year while most experienced workers make up to $170,000 per year.
How Can I Invest In Real Estate With No Money?
- Purchase Money Mortgage/Seller Financing.
- Investing In Real Estate Through Lease Option.
- Hard Money Lenders.
- Forming Partnerships to Invest in Real Estate With No Money.
- Home Equity Loans.
- Trade Houses.
- Special US Govt.