Ten Real Estate Investing Tips

Real estate investing tips tend to be a bit vague, likeyou want to get out of this?" It is rare that
"invest in the right location," or "make sure thesomeone is offended by this simple question, and it
numbers work." Actually, tips like these are importantsaves you from wasting valuable time talking about
principles to remember. However, since they havethings that don't interest him or her. Once you get a
been well represented in other articles, I want toclear answer, you can decide if you can give them
share a few more specific tips with you.1. Listen towhat they want, and still get what you need.5.
the market. The cabinet guy looked to me for aInvest safely. Investing isn't gambling. There is always
decision. I realized that I knew nothing at all aboutrisk, but the difference is that the odds are in your
which cabinets people like, so I asked him which onesfavor. If not, you are gambling. This why you
others were choosing, and he pointed to one thatshouldn't invest based on continued price increases.
three quarters of his last forty customers hadThere is no guarantee that prices will continue up at
chosen. That's the one I want, I told him. Why argueany particular rate. Do deals that work even if prices
with the market you are trying to sell to?2. Do yourgo nowhere, and if values go up, you're that much
own research. The real estate agent might show youbetter off.6. Run the numbers. It is about the
only the comparable sales that make the propertynumbers, and if it is income property, it's about one
look more valuable. Do your own research. Somenumber in particular: cash flow. Whatever the local
counties have made it easy now, with sales pricesformulas are, whether gross rent multipliers or
online. You can also search any number of sites withcapitalization rates or whatever, just be sure that
MLS listings, just to get an idea about the askingafter every last expense you'll have cash flow from
prices of other nearby properties.3. Partner carefully.the very first month.Rules, formulas and real estate
When you do a deal with partners, be the money ortips are really just guidelines. Even the rule above
the management, but not both. Group decisions tendabout cash flow can be broken if you know that
not to work well in real estate, and will cause yourents can be raised soon, for example. You have to
much stress. Once you decide on and agree to ause common sense and learn from experience, and
plan, step back if you are investing the capital, andyou can't replace good analysis with rules, formulas
let your partner do his thing. Of course, step up andand real estate tips.Steve Gillman has invested in real
take control if you are managing the project.4.estate for years.
Negotiate openly. Just ask a seller outright, "What do