Could Real Estate Still Be A Good Investment

Investing in Real Estate to Make Residual Income

There are many ways that Real estate can make people money. There are many distinct varieties of real estate to put money into. It is crucial to consider the purpose of the real estate prior to making an investment. There are 9 steps to take before making an investment in Real Estate.

Step 1 Make Sure You Are Ready

It is important to Consider if you are prepared to purchase Real Estate. Getting a Land Lord could be a daunting but rewarding undertaking. You will need to be available 24/7 prepared to fix any breakdowns that happen in a residential setting. These repairs may eat into profits. If you are handy and love to fix things, then investing in real estate may be a great fit for you. If you are not about the handy side, you can always hire someone to fix and take care of the property. You will need to remember that you will find good and bad renters. Some tenants are going to continue to keep the place pleasant, while some have the option to trash it out.

Step 2 Pay Down All Debts Before Earning Real Estate Investment

Make sure student loans, Medical bills, and credit card debt is well managed and paid down before thinking about investing in Real Estate. Although Real Estate has the potential to return your income, there's still likely to be expenses and state taxes included, together with costly repairs.

Step 3 Acquire the Down Payment

Most investment properties Will demand a bigger percentage of down payment in comparison with owner-occupied properties. In the minimum, 20 percent will likely be needed because mortgage insurance is not readily available for Investment properties.

Step 4 Take Note of High-Interest Rates

If You Need to borrow Money to buy your investment property the loan will most likely have a much higher interest rate in comparison with traditional mortgage rates of interest. To be able to generate income off your investment property, you will need to remember that the monthly loan payment will need to be lower than the rent you are charging.

Step 6 Stay Away from Fixer-Uppers


Although the Cost of Homes which need to be repaired is relatively low, you'll need to choose whether you're able to really afford to fix the house. This also includes if you have the means and skills to fix up the home. Diving into poorly manicured homes is really a bad idea, and can end up being a costly money pit.

Step 7 Calculate Operating Expenses

It's important to know The expenses of your new investment property. Use 50 per cent rule when calculating. If your charging rent of $2,000 per month then you can expect to pay roughly $1,000 in expenses

Measure 8 Look for Low-Cost Homes


The more expensive your Investment property is, the more expenses you will need to pay. It's best recommended to invest in a house with a value of 150,000.

Step 9 Location is Key


Finding the Perfect location Can impact your investment dramatically. Look for locations with low property taxes, excellent school districts, low crime rates, and amenities. These steps can help you think about the ups and downs of investing in real-estate.

Works Cited:

Tim Parker Investopedia. 10 Tips for buying Your First Rental Property. [Internet] 2017 [Cited 4 Dec 2017] Available from: https://www.investopedia.com/articles/investing/090815/buying-your-first-investment-property-top-10-tips.asp

More information: http://www.kongregate.com/accounts/skylifemilton.