Are You a Good Candidate for Real-Estate Investing?
Real-estate investing brings many advantages, which is why so many people are, at the very least, considering this option for their personal wealth. Investors enjoy an independent lifestyle, get to buy and sell some of the most interesting properties in the area, and (once the business is rolling) command a passive income.
So why doesn’t everyone become a real-estate investor?
Because it’s hard.
Because it’s complex.
Because it’s risky, at least compared to other forms of investing.
To overcome these challenges, you need a variety of traits…
Are You a Good Candidate for Real-Estate Investing? 13 Signs it Would Be Right for You
1. You are Resourceful (with Contacts and Materials)
Real-estate investors need to use all of their resources to maximize success. This means utilizing all of their contacts, and using materials and tools (such as technology), to achieve the best results. Of course, if you’re going to be resourceful with people, you need to reciprocate and offer to help people when they need it. Real-estate investors need resources such as lenders, real estate agents, contractors, and other people who can assist in their success. They also need tools like mobile technology and access to reliable information.
2. You Can Focus on Goals
High-achievers in any industry know how to set reasonable, measurable goals. They also know how to take the appropriate steps to achieve these goals. If you have struggled to stick with past goals, such as financial or fitness goals, you may find the long-term rewards of real-estate investing are hard to achieve. However, if you are a goal-oriented person with a track record of meeting and surpassing personal expectations, real-estate investing could be perfect.
3. You Have a Strong Independent Streak
Real-estate investing is tough, often frustrating work, so why not quit and simply enjoy a comfortable office job? The challenges come one after the other, but most investors have a fiercely independent streak that keeps them motivated. After all, if they fail to turn a profit they may have to get a “real job!”
4. Your Education is Never Complete
The real-estate industry is always changing. Evolving trends and new technology are bringing rapid changes, so it’s important that investors stay ahead of these changes. Successful individuals (again, in any industry), always want to increase their knowledge, so they read books, subscribe to magazines, attend conferences, and meet with other investors to continually educate themselves on the industry.
5. You Have Confidence…
As we’ve said before, real-estate investing brings a lot of challenges. For many people, these challenges can turn an enthusiastic new investor into a frustrated, disheartened property owner. To achieve in this industry, you have to have confidence in yourself and not be deterred by obstacles.
6. ….But Remain Humble
While confidence in important, it’s also essential to stay humble. No matter how much success you have, you need to maintain a clear-headed, grounded approach. It’s easy to think that because you overcame one challenge, you can take of virtually any property and make it profitable. But this can lead to financial disaster, so stay humble and you’ll stay successful.
7. You are Comfortable With Numbers and Math
To be a successful real estate investor, you don’t have to hold a doctorate in statistics and calculus. You do, however, need a basic understanding of math, as well as a comfort level with a few of the most important mathematical principles that apply to investment property. ROI, or “return on investment,” is one such principle that you should understand. You should know how to add expenses, estimate incomes, and predict market appreciation, among other math-based skills, to have prolonged success as an investor.
8. You Embrace Technology
The real estate industry is changing, just like virtually every industry, thanks in large part to the rapid developments of technology. New software, applications, and tools are creating a real estate sector that is faster, more efficient, and more competitive; to stay ahead of the curve as an investor you need to understand what technologies can give you an edge and embrace these technologies.
9. You’re Comfortable With Networking
Real-estate investing is not for the shy. You have to know contractors, agents, bankers, and many other people who can assist in your success. (While you assist in theirs!) A successful investor doesn’t have to be a charmer, but they do need a comfort and confidence with networking.
10. You Have Some Experience with the Industry
It’s a complex industry, one that can bring surprises, challenges, and a long line of frustrations. Experience is often needed, as it will give you a longterm perspective on how to thrive in the industry.
11. You Can Create and Execute a Strategy
Having a plan, executing the plan, and not diverging from the plan (at least not too much), is crucial to success. If you are the type of person who can develop and put a plan into place, you may be more likely to have financial success with real estate.
12. You Can Walk Away from Purchases
When you start looking at potential investments, you’ll find numerous properties that seem like a great option. But the price may be too high, or the property may need too many repairs. You have to be able to walk away from a deal. Have you ever walked out of a car dealership without buying a car? If so, you may have the required discipline for a successful real-estate investor.
13. You Can Be Patient
The rewards of real estate are often realized long after the purchase. It often takes years, even decades, to turn a real estate investment into a large deposit for your bank account. Can you wait? Do you have the discipline, as well as the financial foundation, to wait for your profits?
Superior Loans for Your Investment Needs
If you are thinking about the potentially lucrative world of real-estate investing, contact our team and see how affordable loans can assist in your success. By taking a common-sense approach to mortgage underwriting, we can help you find the right financing for virtually any investment purchase.