Everyone is always looking for a get-rich-quick scheme, but usually those are just that- a scheme. They rarely work and are often too good to be true, but what if you could make a decent living off of real estate? You may not be rich, but you can make yourself a great retirement out of it and live comfortably without too much stress. If this is something you are interested in, here are four quick tips to help you get started.
1. Start Early. Never underestimate the power of money accumulating over time; the more time you give it, the more money you can potentially end up with overall. There are many opportunities to invest in properties, but the earlier you start, the more active years you have to purchase.
2. Buy Smart. Every time you go to look at a property, you need to think numbers. The average goal you should look to make on each property is 15% for the cash on cash return. When you make a 15% return on investment, or ROI, you can continue to roll that cash into another purchase, which accumulates over time to give you more cash in your account. Whether you are looking to flip a property or rent it out, this base number gives you an idea on how much to spend on improvements, list the property for sale afterward, or where to set a rental price.
3. Stick to Rental Properties. The most secure way to earn a retirement is to own rental properties. The more you buy and rent out, the more your monthly income is from the payments. When you flip properties or try to sell for profit in a short time, you get large inconsistent chunks of money at a time. Bringing in monthly rental payments is referred to as "passive income" because you don't have to do a lot of work to collect that payment and it comes in consistently. If you start early and buy up rental properties over the years, you have a chance to bring in much more money every month. This is especially true as rental prices go up and mortgage payments go down over the years.
4. Hire a Property Manager. If you are going to rent out a lot of properties, you don't have to take on all the work yourself. Hiring a professional property manager to handle all of the complaints, fill the vacancies, and do the repair work limits the amount of time and expenses you have to invest in your properties. Since this is their full-time job, they have the resources and knowledge to get the best deals with local contractors. This helps you feel more secure retiring or handling your business as you age.
If you are looking for a great retirement option outside of the usual stocks, bonds, and mutual funds, real estate is a great option. For further guidance, contact a local real estate lawyer, such as one from Meredith Bateman Law Office.
Share6 May 2015
