Real Estate Investment 101- It's Not as Complicated as You May Think!

by Dan Jensen
Relocation Services Director - Equity Northwest Properties Group

This is a follow up to the May 30th post on Real Estate Investment.

I thought it might be useful to debunk some of the myths out there in the market place about complexity issues, need for huge financial reserves, "but the market is saturated with investors" issues, etc. By providing a short and simple overview of some of the investing strategies and processes within Real Estate, I'm hoping to stir your thinking and perhaps open doors of possibility as well! (Check back over the coming 3 Fridays)

When someone says, "real estate investor", what comes to your mind? Are you thinking Daddy Big Bucks finding great deals on huge commercial office buildings (are you thinking 'The Donald' about now?), or are you thinking about that little 87 year old lady you met last month who methodically purchased small rentable houses over 40 years of her lifetime and has been very comfortable financially for the last 20+ years living on the rents her tenants pay her every month?

Or maybe your thinking went right to the tanned fellow in jeans and work shirt who just finished remodeling that "fixer" he bought a month ago and who is about to 'flip' that property for a nice profit as a reward for his work?

There's no question that each of the above represents real estate investment. These and many other scenarios begin to describe the variety of paths you could choose to follow if you ever decided you'd like to invest in real estate. This is an especially important time to be thinking about such things, as we are highly likely to see a return to higher inflation rates in the USA, and real estate has traditionally been one of the most powerful protections against general economy inflationary cycles.

But most who think about investing in real estate don't ever put their thoughts into action. Lack of money is one concern. Not knowing a good deal from a "great" one is another concern. Carving out the time to do any kind of research and investing is another barrier for many.

Let's break it down in the days ahead and see if we can move beyond these "barriers" to RE investing.

Here's 3 pieces I'll be detailing in the weeks ahead...

1.) You CAN invest in real estate with VERY LITTLE MONEY in your bank account

2.) You CAN accumulate a strong RE portfolio, increasing your net worth steadily, over time.

3.) You CAN "Buy Low & Sell Higher", turning fixer properties into nicely remodeled properties. It helps if you're handy, but even if you're not, you can still invest in this way and make it pay.

Next Friday, I'll describe 2 tools that allow you to invest in real estate with VERY LITTLE MONEY.

Check back then, and as always... give us a call if you have questions. We love to help!

Have a great Father's Day weekend!

Have You Considered Becoming a Real Estate "Investor"?

by Dan Jensen
Relocation Services Director - Equity Northwest Properties Group


Certain words will often produce specific responses in each of us. "Good", "Bad", "Tall", "Short"... We each have our own understanding of what those words are describing, and there are some pretty dramatic differences in each description.

It's the same with the word "Investor".  What do you think of when you read the question, "Have You Considered Becoming a Real Estate Investor"?

     * Having a million dollars cash sitting in a strong box at home and looking for great real estate deals

     * Having ZERO dollars, but still being able to make stunning RE deals with "no money down"

     * Gradually buying one rental house after another over a period of years until exceptionally wealthy

     * Buying a great home at a great price, living in it, and watching the value grow into a retirement fund

The fact is, all 4 of these can easily qualify as "Real Estate Investments", and a dozen more descriptions in addition to these.

Investing in real estate is much more about your objectives in purchasing a property, and not so much about which path you decide to take in order to reach your objectives. Any of the four paths listed above can move you steadily toward the investment objective of building wealth and/or income. (two very different results, by the way!!!)

Most homeowners in the USA bought their home with no real thought of that purchase being a part of their wealth/income investment strategy. You want a great home for you and your family, and "yes", you're counting on your home to increase in value over the years that you own it, but it isn't really about investing in that house at all.

Then careers grow more rewarding, and the idea of a second home, a "vacation" home might begin to percolate in your thinking, and sure enough, you find a great beach house within a sensible drive from the family home, and you buy that it. Once again, not really thinking real estate investing, just expanding the enjoyment you're experiencing through your dwelling arrangements.

However, the moment you look toward that little starter home two blocks over that you drive by on your way to work...

or...

You investigate that cute little 2 bedroom beach house just down the sand a couple of houses from your vacation home...

with the idea that you can buy it for a great price and either resell it for more soon, or rent it on-going for a nice additional stream of income,
you've clearly crossed over! to the "Investment" side of the house!

We've heard it a thousand times before... "More wealth has been created and/or maintained through Real Estate Investment that by any other method"! It's true, and we know it's true, but the financial numbers are significant, and we don't have all THAT MUCH extra to work with, so we dismiss the idea as a possibility for us, and never find out more.

There are some very powerful and AFFORDABLE ways to move safely and productively into real estate investing.and we'll be covering a few of those over the coming weeks. Check back for more.

Also, if you are intrigued a bit and would like to compress the information timeframe, give us a call. We would love to do some strategizing with you about ways to invest that you might find useful.

Thanks for checking in with us. We love to help!