As a newbie to the real estate game, it can be both an exciting and terrifying way to invest your hard- earned cash. Real estate throughout history has proven to be a great investment, producing a lot of extremely wealthy people. We are going to start with baby steps and before you know it, you’ll be the next Donald Trump!
- Out of Pocket – Break down all your expenses to a monthly level: mortgage, taxes, insurance, condo fees, utilities, lawn maintenance, pool maintenance, etc… Don’t exclude anything! You want the monthly rental amount for the property to exceed this number. If you can put cash in your pocket each month, that means your property is working for you and paying you each month! This is huge!
- Location – Some of the lower priced properties are priced that way for a reason. Don’t fall into the trap of buying the bottom end to find out you just bought into a drug and crime infested neighborhood. Good luck with renting it and getting paid each month – it’s not gonna happen! In a down market like the one we are in now, it will serve you in the long run to be patient and wait for “A” locations.
- Hire a Pro – You want a professional property management company on your side (this is where we can help!). Renting your property out can cause you a lot of frustrations. Do you really want to talk to your tenant at midnight if their A/C unit goes out? Deal with a slow bathtub drain? You need to spend your time looking for and analyzing more deals to buy. Build your portfolio and let someone else manage it for you.
- He Who Cares Least Wins – Do not overpay for a property just because you want it. Get that thought out of your head! You would love to have the property, but you certainly do not need it. The moment you get emotionally involved and need it so badly is the moment you start to overpay, therefore losing control and screwing up your investment. Don’t do it!
- Good Tenants – The rental market is strong. Be picky with whom you let maintain and live in your investment. Every time someone abuses your property that’s more money out of your pocket, which is the opposite of what we want.
If you do your research, are patient, and hook up with a professional, you’ll be surprised at how quickly you can build a small empire of investment properties. Good luck!
Need help Selling, Buying, or with Property Management? Please contact Gabe directly at: 239.825.2234, Gabe@GulfPointeProperties.com or www.GulfPointeProperties.com Gabe Mellein is the broker of Gulf Pointe Properties, He is a member of The Naples Area Board of Realtors, Bonita Springs – Estero Association of Realtors, Realtor Association of Greater Fort Myers and the Beach, The Florida Association of Realtors, The National Association of Realtors, and is nationally certified in Feng Shui for Real Estate.