Is Real Estate The Investment Vehicle To Begin?

Many people are living with a dream that may never become a reality due to errors in judgements they make every single day. There is no blame on your living habits from the outside world; they do not care. The only person you can blame is yourself and the personal wealth that wasn’t created during your earning years. Get in a regular saving habits first for your rich retirement. The message I want to pass with this article is dedicated to all age group people that are planning to retire rich.

Why real estate for a first investment? The money you earn depends on how prudent you are on your subject, same principle relates to real estate. If you do not understand how economic basics works, why inflation or interest rates are rising or never been in a stock exchange it would make a common sense to stay away to from complicated investment vehicles.

Real estate is simple tangible living space that secures you from the outside world. It has many names but 95% of population calling it home and dedicates to it most of their time. So why not to take an advantage of this fact and invest in a living space that somebody calls home.

Where or how to begin? If you are a beginner, your main incentive is to make as much money from your first investment as possible as quick as possible, therefore the crucial mistake first time investors do is investing into off plan properties. I have nothing against off plan investments, but in your case you are not ready for this investment yet. The area you should choose for your investment is your neighbourhood. Why – simple, you know it already and you can control it. Forget about the magic stories about buying and flipping properties without no money down or getting tremendous returns without money down or hard work. It is possible, but people who gained and bragging now about were working diligently for a number of years: building contacts, market knowledge, capital, etc. There are no get quick rich schemes, but it is possible to become very wealthy slowly. Real estate will always have value no matter what, where stocks, bonds can lose their value to 0.

Before you start your first investment, make a little plan: how you are planning to go about it, what assistance you may need, how much time to allocate, what’s your budget and what’s the outcome you want to achieve, than follow that plan.

In my opinion first item you have on your plan is to visit local real estate agent to get the price and properties for sale in the area. This will give you info on capital requirements, property volumes available and rent returns achievable. Having all that in mind your hunt to secure best finance deal available. Do not fall with unnecessary depth to much with your first investment, maintain balance you can afford. It may take a good few weeks to swallow and digest all this info, but stay patient and maintain your composure, you on a way to retire rich. Do not fall in love with your first property or do not search for the property that is ideal for you, you making an investment not buying your own home, remember that suits you may not suit your tenants. Buy something way below market value and add value, make it better when you bought, the returns you will receive will exceed all sweating hours spent many times over. 

The rule with you investment should be based on a simple logic: the rental income your property generates each month should cover your loan repayments and bring profit each month into your pocket. Use profits wisely; allocate some portion for unforeseen rainy days as they will come. Live well with you tenants, they are your business - they are bringing you into rich retirement. 

As final reward for all your hard work you done for your asset comes capital appreciation, which will be released after your property sold. Property holding times depends on your real estate business wisdom and goals, but as a starter you should keep your real estate asset at least for 5 years.