Fundamentally, you have three ways to make money when purchasing investment property. The first is to lease the property for an indefinite period at rents that exceed the cost of holding the asset. The second is to purchase the property with the intent of renovating it to substantially increase the value and selling it quickly. The third is to find properties that need to be liquidated quickly at a substantial sacrifice to equity. An investor can acquire these properties and immediately sell them for a substantial profit.
So how do you get started?
The first step is always education. Start reading books about real estate investments. Go the
book store or library and learn the fundamentals. You don't need to be an expert, but you must
understand the process. Find a realtor that works with investment properties and ask questions.
Do the same for mortgage brokers and banks. Sit down with a loan officer or mortgage broker and
determine how you would finance an investment. Ask questions and find real estate and finance
professionals that can help protect your interests as you learn.
The next step? … Find the properties.
With the aid of the real estate professional, determine the best type of investment for your
lifestyle, financial position, and risk profile. After you determined best type of property to
maximize your return, begin searching for your investment. For this, the internet has become an
invaluable, time saving, tool. Search for potential investments at sites like
propertykenya.com
or Housing Finance of Kenya. In addition,
you can look through your local paper, and call on the resources of your network to find the
opportunity.
But how do I recognize the opportunity when I find it?
Valuing a potential investment is not as difficult as it may seem. For investors looking
to receive a return for charging rents, evaluation software such as
IP Ware aids in finding the maximum return on
investment. For investors that are looking to renovate and re-sell, comparable values of
the surrounding area can be a good foundation. Finally, for those that are looking for
people that must sell at a substantial sacrifice, mortgage lenders, tax records, and
financing groups can be a significant source of information.
Investing in real estate is a simple process. It is merely a matter of locating a potentially good investment. Determining how to best leverage that investment. Then using your resources and relationships to minimize your risk, and maximize your return. There is a myriad of resources available to beginning real estate investors. Isn't it time you took advantage of the opportunities in real estate and started building your wealth?
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