Real Estate Essentials – Passive Income From RE Investments



Learn How You Can Explode Your Passive Income Through Mastering Real Estate Investments

Real Estate Essentials – Explode Your Passive Income Through Mastering Real Estate investments is an eBook that is aimed at helping you become successful by investing in real estate. This is research based on expert advice and firsthand experience of real estate investors.

And today the book, from which this post was extracted is yours for the keeping. Yes, it’s your FREE gift simply because you are a visitor to this, the REAMS blog-site.

Following is the excerpt from chapter 2 of Real Estate Essentials – Explode Your Passive Income Through Mastering Real Estate Investments

What to Consider Before Investing in Real Estate

Synopsis

In chapter two, we look at the factors to consider before real estate investment. There are many benefits of this kind of investment. However, you just can’t rush in and put your money in it before making a few considerations.

  • Capital
  • Returns on investments
  • Analytic abilities
  • Investing your time
  • Stress Management
  • Research
  • Market Research
  • Return rates
  • Type of investment to make

There are people who are well suited for real estate while others may not be able to handle the pressures and stresses that come with this kind of investment. You have to learn about what to expect in the industry so that you can gauge which category you fall in.

Remember, even if you don’t have what it takes, maybe you can work on this. There are things that you can learn with time. There are also solutions to some hurdles that may be presented by real estate investments.

Think About This!

Capital

This is one of the key considerations to make before investing in real estate. You will need to have adequate capital in order to make your investment. Even if you save a lot of money, probability is that you will require further funds such as loans.

To invest in real estate is not easy because properties normally cost a lot. In addition, apart from buying the property, you may have to do some repairs or renovations. You have to ensure that it is in good condition so as to get a good quote when you decide to sell it.

Apart from the cost of buying property, there are also additional transactional costs that you will incur. For instance, there may be a brokerage fee. There are also taxes that have to be paid. You can look for loans or other means of raising the capital well in advance. If you don’t manage to do this, you should then consider alternative investments.

Returns On Investments

Investing in real estate doesn’t guarantee overnight success. If you are looking for an investment that will give you returns in just a month or two then this isn’t the right investment for you. Real estate investors know that you have to be very patient in order to get your returns. You also need to set realistic goals.


If you try to rush your investment, chances are that you will make losses. Desperation may force you to make bad decision such as selling your property for less money that you would have if you had taken your time. Real estate investment can be very profitable but it takes time. In addition, it also takes a lot of hard work. This is not the kind of investment that you will make and just wait for returns to materialize. You will need to work hard so as to succeed.

Time Investment

You should be willing and able to invest both time and effort before getting into real estate investments. There are many people who have managed to invest in real estate on part-time basis. This means that they have full time jobs but still have to manage their investments. This doesn’t mean that they don’t have to give adequate attention to the investments though.

It is good to try and see if you can spare adequate time in advance. Just test yourself like you would if you had already made an investment. You can use sometime to consult with people in the industry and carry out some research. This will allow you to determine how much time you can invest in real estate. If you try out this exercise and find out that you are unable to spare sometime from your job, then you are not ready to invest in real estate.

Click this link to get Your FREE Copy of REAL ESTATE ESSENTIALS eBook!


More Relevant News

Wells Fargo To Exit Wholesale Channel After Fair-Lending Accord

From Bloomberg, an article written by By Dakin Campbell and published Jul 12, 2012 11:58 AM ET

Excerpt:

“Wells Fargo & Co., the largest U.S. mortgage lender, said it will stop funding loans originated and sold by independent mortgage brokers after settling a federal fair-lending investigation.”

“The company made $7.4 billion of mortgages through brokers in the first quarter, the most of any lender and 21 percent of the industrywide total, according to Inside Mortgage Finance, a trade publication. The loans made up about 5 percent of the company’s total, according to the statement.”

Cheap Real Estate Property Is Hard to Find


When it comes to real estate in the post-subprime era, it’s really hard to find a cheap property, or even to identify one. Cheap property, including one-to-four family residential homes were very prevalent during the early part of the 1980s. They were ideal for people on a budget; and to give real estate agents a chance to do more business.

Agents could make a better impression on their buying customers by showing them how to buy a home at a low price, do some rehab work on it using the 203k rehab mortgage loan, and resell it at a higher price. Making money with real estate was much easier then – no matter how you approached it. Finding cheap property today is a totally different story.

Between 1987 and 2007 the price of real estate property increased by over 300 percent according to a Property Price Index chart I found on the Steadfast Finance website. While this post is not intended to be scientific in nature, it is necessary to use facts and figures to back up the main idea that, due to the balooning of home prices over the 20 year period mentioned, and the subequent crash, it is tough to find a cheap property which doesn’t have a mortgage that dwarfs its value.

There is not much room left to build equity for the foreseeable future without a dramatic rebound of real estate market prices, and I don’t see that happening anytime soon. However, there may be some instances where you may find cheap property throughout the United States, but the market areas – some being better than others – in which they are located will most likely be depressed, thus removing the motivation that would otherwise exist for you to purchase it.

Let’s face it, most towns/neighborhoods that offer the cheapest properties would normally be economically depressed in most categories. Even those areas that are considered middle class by the traditional definition suffered a great loss of property wealth and has none to offer you as an investor looking to turn a quick profit, or home buyer who is looking to build equity.

There is some indication that property values show signs of increasing but that increase in value, providing it is real and consistent will go towards leveling off the property owners’ existing underwater situations. It does not help prospective buyers simply because the property owners are unable to sell until they are able to satisfy their lenders from sale proceeds. It is unreasonable to assume that a property owner is willing to dig into his/her own pocket simply to make a sale to anyone and walk away that much poorer.

You may be thinking; well if all this is true, how will investors be able to stay in business? The answer to this question is rental income! Some investors buy to resell while others buy to rent. Short term versus long term investments; And you can safely assume that when the buy/sell market is tough, most of them will put their money into rental properties.

Keep in mind that when the market is tough for investors, it is similarly tough for home buyers to get reasonably priced homes to buy and mortgage money to finance them, so many of them become new tenants for the long term investors.

If you are in search of cheap real estate property in today’s (July 2012) market, you might get lucky and find that proverbial need-in-a-haystack property that is either free-and-clear or has a very low mortgage balance, where the owner has passed away and the estate is forced to sell…

Or a free-and-clear/low-mortgage-balance property that is in disrepair and perhaps uninhabitable without major rehabilitation and you have the means with which to purchase, repair and resell. However, you might have to look long and hard, so be prepared for the long haul.


If you have been in the market to buy a home for your own personal use, or you are an investor looking to buy cheap, repair and resell; I would be interested in learning about your recent experiences. If you have had some good luck and found the ideal property for your purposes, or you’ve had the worse time trying to find a property you can work with; tell me about your experience in the comment box. Good luck!