What do you think it takes to succeed in real estate investment? When the rubber meets the road, success in real estate investment isn’t about the newest technology, the flashiest marketing, or the newest investment platform. No, if you want to find financial security and build your wealth through passive real estate investment, you have to rely on proven strategies.
Real estate is among the most reliable assets in the world. As a tangible asset, real estate is often immune from market fluctuations and, in fact, has a reputation of being a recession-proof investment.
The idea of renting goes all the way back to feudalism. This is an industry that has been in existence for centuries in some form or fashion. Our modern idea of investing in real estate has been around for nearly as long.
There’s history — and history of success — that we can look to as we figure out the best and most effective ways to invest. As a real estate investor, look to the tried-and-true ways. While the industry will adapt and innovate with the times, the foundation remains the same.
4 Proven Principles to Guide Your Real Estate Investment Career
Select the right markets.
We all know the old adage by now: location, location, location! As much as this can seem trite now, it’s no less important. We can’t just invest anywhere and expect success. While there is a temptation to stay local when investing, we must consider that our local markets may not be best suited for investment success.
Selecting the right market, the right neighborhood, and even the right property is essential. What goes into the selection of a market? The factors are many, but we must look at the economic trajectory of the market (including employment and housing demand), population growth, and history of home and rental values.
Not only that, but we must think comparatively within our individual circumstances. While you may identify what seems like a great rental market (and it very well may be), you must compare it with your own capacity to invest. If you live in a more expensive market, it makes sense to aim for markets where the cost of living is significantly lower — allowing your capital to stretch further. Living in a more balanced or inexpensive market, however, causes us to examine where our money will be most effective. It may not be in every market!
Be sure to check out: Balance in the Real Estate Market Bodes Well for Investors!
Identify trusted partners.
Partnerships are an inevitable part of real estate investment, no matter what strategy involved. We all need other people. Who you choose to trust with your investments, be it a turnkey partner or a short-term service, is paramount to your success. What’s their track record? Are they working towards your goals?
Trust is earned over time, but reviews certainly help. Talk to others in the industry to see what they’re saying. In the same way, a turnkey investor has to rely on and build a relationship with their provider in order to be an effective investor.
Mind the market.
We’ve talked about the market cycle before. While buy-and-hold investors have far less to worry about when it comes to timing the market, it’s still worth considering. We firmly believe that there’s not a bad time to invest in real estate. When you have a turnkey, buy-and-hold strategy, timing becomes a lot less important.
That said, it’s still a factor. The real estate market moves in cycles and there are times when it is more profitable to invest than others. What’s more important than the specific real estate cycle may be the economic cycle of the market. While your turnkey provider will do all of this research for you to determine the best opportunities, stay abreast of the goings-on around you.
Buy and hold.
Buy-and-hold real estate investment is among the most popular investment strategies. There’s a reason for this: it’s been proven to work. What investors do is buy a rental property with the express intent of holding it — generating passive income and gaining appreciation as time goes on.
While we can be attracted to the newest investment methods and crowdfunding platforms, the heart of true real estate investment success is rooted in the systems and strategies that have been used effectively for decades — if not centuries.
Join the thousands of real estate investors building wealth through tried-and-true turnkey real estate.