Is Real Estate Investing Right for you?
Hey you! I’m guessing you’re considering Investing in Real Estate and that’s why you’re here reading this! You may have some questions about investing in real estate that you need to know before deciding to dive in. Hope this helps!
Where do Investors get the Money?
💲 Private/Hard Money Loans – Most people think when investors buy properties they use their own cash. Some do, some don’t. If you don’t have the money to purchase a property all cash, find a Private/Hard Money Lender. These lenders work specifically with Non-Owner occupied properties! AND you’re in luck because we do Private and Hard Money loans! Reach out to us and we will see what we can do to help you!
💲 Money to Close – Yes, we can get purchase and rehab loans. Though, that doesn’t mean that you aren’t going to have to bring some cash to the table. Typically we can get 65% – 70% of the purchase price and 90% – 100% of the rehab funds, the rest you will be asked to bring to closing. But hey, just because you don’t have the money right now doesn’t mean you can’t do it at some point. Start looking for properties to Wholesale to make some quick cash! If you are unsure about how to do this.. Check out our How to Wholesale Blog!
What do I need to know about my Area?
💲 Numbers and Knowing your Market – Run your numbers, then run them again and again (As-Is value, Purchase Price, Rehab Amount, After Repair Value, and Holding Costs). Do some research and see what similar properties in the area are selling for. If you’re working with an agent make sure you trust them enough to not set you up for failure. We’ve come across a lot of agents who will do anything to get a sale on a property. Run your numbers for WORST-CASE SCENARIO. For example: If you think you MAY have to replace the roof, include it in your rehab cost and see if you’re still going to make money from the deal.
Are Rentals or Fix and Flips better?
💲 Short Term vs Long Term – If you are looking for a quick return on investment, you should start with a small Fix and Flip. Buy it, fix it, and sell it! If you don’t mind having your money tied up for a while, rent it out. You will have cashflow coming in each month and your property will be building equity. Of course there are ups and downs with both of these but make sure you do your research before committing to one or the other.
Is it Risky?
💲 Risk – Of course, with all investments there is some type of risk. I’m sure you already know this but if you don’t… You are going to have losses and wins. (Hopefully more wins than losses) Putting money in an investment property is scary, you don’t know what the market is going to be like in 10 months when you are done fixing up the property. Or in 10 years when you are tired of being a landlord and want to sell the property.
Investing in Real Estate can be a great thing but make sure to educate yourself before jumping into it. With great things comes great risk but we believe in you! Like I said before, if you are looking for a Private/Hard Money Lender, reach out to us! We would love to discuss your deal and see what we can do for you!
– Legacy Frontline Team