Guts. Brains. And good documentation.
But seriously, it isn’t rocket science. Or brain surgery for that matter. Truth is, anyone with the desire to own real estate can be an investor. But, not everyone has the stomach for the down markets like the one we’ve seen across the country over the last few years. This is when it’s harder to not knee-jerk and sell , when it’s time to hold. But I’m getting ahead of myself.
What other investment allows you to buy the entire thing with just 25% (or less) down? Certainly not stocks or CDs. Real estate is unique in that it is an appreciating asset that allows you to build wealth over time. Now, there’s the normal cyclical nature of real estate that may not cater to everyone. But, with a strategic approach to your new business, called Your Name Properties, you can create a smart, growing nest egg.
Getting Started
Step One: have the desire and make a plan. Planning takes care of as much of the “unknowns†as possible and eliminates the urge to buy on impulse. Here are things to consider for planning purposes: Do you want to live in your first real estate investment? If not, do you have access to 25% down? If not, then you DO want to live in your first investment. Also, decide how hands on you want to be….can you handle tenant screening? Advertising for rent? Showing the property every evening and weekend? If so, then you’ve just saved yourself roughly 10% of the rent amount by not hiring a property management company. If you need one, then shop around, find the company you feel comfortable with and that comes recommended.
Think about where you want to own….is there a college or university nearby that always needs student and faculty housing? Consider buying something you’d consider living in. If the neighborhood is ridden with crime or near something undesirable, then renters will probably not want to live there either. Once your plan is formulated, stick to the plan. Do not go shopping for a house you cannot afford or cannot afford to rent out.
Taking Action
Step Two:Â Find a real estate agent who can help you find property that is in the right areas for your type of real estate investment. Buy it!
Step Three: Live in it for two years, move out and rent it. Buy your next investment, move in. Repeat.
Step Four: Evaluate your plan and look at each property every year to decide if it’s time to sell and exchange, buy more, liquidate or trade. Your Name Properties is a business that continually needs attention and possible modification.
Being a real estate investor isn’t difficult, but it does take planning and strategic purchases and sales. Don’t skimp on the preparation and you won’t have the knee-jerk reactions that you can live to regret later (like selling at the wrong time or buying with your heart and not according to Your Name Business plan).
Living the American Dream
Enjoy the process….real estate can be really fun, especially when you get to help a family live in a nice home in a safe neighborhood or when you see the equity grow or when you realize you’ve just paid for your kid’s college education simply by owning a rental.
If you have a questions about buying your first real estate investment in the Portland area, feel free to contact us
Jaimy & Sherine Beltran are licensed real estate brokers in Portland, Oregon as well as a frequent contributing writers for OHM. Please don't hesitate to contact them with any questions you may have about buying or selling a home in the Portland area.
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