What do you already know/need to learn about investing?
One of the main questions you should ask yourself is how much do I already comprehend about buying, leasing, and managing rental properties – and how much do I need to learn? Most people have heaps to learn since investing in rental properties requires a wide range of skills and know-how. The really good news is that comprehending the business of real estate investing is something you don’t need a college degree to do. There are a large number of free courses, podcasts, books, and other investors to learn from.
Are you self-motivated?
As a rental property investor, you are in business for yourself, and normally (at least in the beginning), by yourself. That signifies that you may have to stay motivated and on track to land your first (and second, and third) real estate deal, then work a diverse range of tasks from property maintenance and repairs to promoting positive tenant relations. If you find yourself quite struggling to set goals, follow-through, or manage your time effectively, these are all beneficial skills you may need to learn first before taking into consideration real estate investing full-time.
Where do you stand financially?
To invest in rental properties, it’s well known that you have got to have your finances in order. You’ll as well need a really good credit score and, if you intend to finance your investment properties, cash saved up for the down payment, closing costs, and renovation expenses. It’s particularly acceptable to know your financing options and have a backup plan developed if things change. Real estate investors are oftentimes required to move quickly when the right property is available, so you will certainly need to be pre-approved for any loans and otherwise have everything ready to go.
What is your risk tolerance?
Another key question to ask yourself when considering a career as a real estate investor is how comfortable you feel about taking risks. Like all investments, real estate definitely has its own set of risks, from paying for a really “bad” property to ending up with a not-so-nice tenant. Although, there are heaps of effective ways to minimize these risks, specifically if you grasp well how to thoroughly assess a potential property, understand your local rental market, and accurately crunch the numbers.
What are your purpose and end goal?
In closing, it’s logical to have a clear understanding of your purpose and goals for starting a career investing in real estate. Are you desiring more flexibility in your schedule? Higher earning potential? The freedom to work for yourself? These are all proper benefits that come with the business. Although, together with why you want a career as a rental real estate investor, it’s also important to know your end goal.
Can you visualize your end goals or exit plans? Do you have a retirement plan? Conceding that buying and owning rental properties is a long-term investment strategy, to cash in, you’ll eventually need to know how to handle your investment properties and when the moment is ripe to retire.
If you’re ready to take the next step toward a career in rental real estate investing, give Real Property Management Investment Solutions a call. We collaborate with investors to conduct market analyses, locate off-market deals, find quality tenants, and set accurate rental rates. If you’re passionate and ready to launch a new career, making our Grand Rapids property managers part of the team is one of the best ways to get your business off to an absolutely great start!