pink_me question : How do I enter the real estate market
I want to invest in real estate. I’m in my early 40s, have no debt, the house paid, etc. I would be buying property to be considered. I spent much time in front of the local market and have a good understanding of it. But at this point I’m not sure what to do next. Should I purchase a rental property? If so, I can look in the BR 2 small houses, duplexes or houses? Or should I use for properties that have been sitting on the market should look for an extended period require TLC, etc., then it brings? I’ve never done before, and not really spend much time, conversion, if I louer.Et, the region where I live is a rural and somewhat depressed. What is your approach to real estate Best Answer:
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Since you have plenty of equity in your home I would utilize it to purchase other properties. Sinece you live in a depresses market I would stay away from flips unless you get them at 30-40% below market value. Also, another strategy would be to buy and buy alot of flips now and rent them out tillthe market gets better nd then sell. You could also purchase land and subdivide then sell to builders if it is in a up and coming area. It really depends on your area and what the market consists of right now.
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I would not take on any debt and have it personally. I would set up an LLC, which by the way is the best way to hold real estate in most states. Then I would buy cashflow houses. What i mean by cashflow houses are houses that give you positive cashflow month after month. I would say that they be rented with atleast a years contract so that you get a steady stream of income for the first year atleast. I would buy homes that are already remodeled and cost under 50K. I would say duplexes. Avoid SFRs for now. Why? Well if you need to repair a roof, you do it for only 1 duplex and not 2 SFRs. So keep that in mind. I would avoid flipping right now as it is no longer a buyers market. The time has come and gone for that. When you rehab, who will you be selling to? Except if you do a lease to own. Which is a good move as most tenants never get to buy these properties as they usually have bad or crappy credit and are unable to clean up credit by the time they need to make purchase. I would comb thru home. Compare against others. I would be weary of those on market for a while. Why have they been on the market for a while considering that not too long ago, the market was a buyers market and every Tom, Dick and Jane was paying top dollar for a fools gold. So best wishes and good luck on your real estate journey. But remember you need to do it as a business. You will get much more out of the tax code than you would doing it as yourself.
I’d suggest you speak with a financial planner and a local real estate agent. Id put more focus on triplex and fourplex.