Are you interested in getting started in real estate? We don’t blame you. It’s generally considered one of the safest forms of investment, and it’s a fantastic option for those who want to get a pretty good return. Of course, this doesn’t happen every single time, and there are still a lot of considerations that need to be made in order for you to break into this world successfully.
You can’t just decide that this is the right path for you without sitting down and thinking it all through carefully. It’s not a whim, because it costs a lot of money to even get started here. So, if you’re not sure yet but you think this might be what you want to do, you’re in the right place. Down below, we’re going to be exploring some of the things that you can do to break into the world of real estate, without making it too complicated. Want to know more? Read on.
Simple Steps to Start Your Real Estate Journey
1. What’s Your Budget?
The very first thing that you need to look at is what your budget is because money makes the world go round, and there’s no way to avoid it. You might be thinking that the goal is to make more money, so why do you need a whole bunch of it to get started, and the simple answer is because buying property is expensive. There are different types of loans that you can apply for as an investor though such as bridging loans, so they might be something to consider.
But, before you look into borrowing, you need to know what you already have. What do you have in your bank account that you are able to put towards your investment? From there, you can work out if you need to borrow any, how much you can reasonably borrow, and then you’ve got your budget. Ensure that you account for any additional costs that might be involved, as well as the purchase itself.
2. Look Around Properties
When getting started in real estate, establishing your budget is the first crucial step. Once you know what your budget is, you can start looking at different properties. Work out what kind of property you are looking to purchase before you head out just to give yourself an idea of what to look for. If you start looking without any idea of what you actually want, it’s probably going to take you longer to find somewhere to purchase. Or, you will go in the complete opposite direction and purchase something you didn’t even really want in the first place.
It might even be worth making a list that you can refer to when you’re walking around the place. Of course, you need to get a feel of the property itself as well as its characteristics, but if you don’t know what to watch out for, take someone with you who does.
3. Consider Fixer Uppers
It might be the case that you are interested in renovation projects. If you are, then purchasing a fixer upper might be the best choice for you! You get the property at a reduced cost because it has so much work that needs to be done, and then you can transform it into exactly what you want it to be. You get the option to either do the work yourself if you want as this is the cheaper option, but you won’t be able to do everything. Or, you can hire people to come in and turn the space into a vision.
Just keep an eye on how much you are spending here because you don’t want to spend exuberant amounts, added on to the cost of purchase, and then sell the place for a tiny profit. You’ve got to think through all of the potential profit options as you’re fixing things up, and balance it against how much it’s costing to get it into the right condition.
4. Find The Right Tenants
If you already know that you are going to be looking to purchase a property with the intention of renting it out, then you need to find the right tenants to live in your space. Ideally, you want people who seem trustworthy, have a decent income so you know they can afford it, and if they have rented before, you need references. It might sound excessive, but the last thing you need is to constantly have to chase rent payments, or for your property to be turned into something unrecognizable.
It’s a good idea to potentially look into the best property management software on the market right now if you have more than one rental. This way, you can keep everything in order, you know what’s going on with each property, and you don’t have to try and keep track of everything manually which can be a nightmare.
5. Work With Realtors
If you’re getting started in real estate, you’ll likely find it much easier to work with realtors. They will find properties for you, so you don’t have to. Work with a few different ones as they will all cover various areas of the country or town you are looking to buy in.
Realtors can be extremely knowledgeable and powerful members to have on your team. You don’t want to work with ones who don’t know what they are doing, so read reviews from previous clients.
6. Find The Right Locations
Getting started in real estate truly hinges on understanding different locations and determining if they align with your investment goals. You’re not tied to one spot; if you have a car then you can pretty much travel all over the country. It is essential you do your research here, as you don’t want to buy property in a high crime rate area. These will likely sell for lower prices than other areas and this is the last thing you want or need.
Take your time with this step, you don’t want to rush into anything. Visit areas both day and night to see who is hanging around each time. When you find properties, speak to the neighbors to find out what they are like. Your buyers or your tenants will thank you for it eventually.
7. Proper Checks
Getting into real estate doesn’t just mean buying a property and passing it off to the next person. It means you care about the property you are buying and the tenants that could potentially be moving into your property. You need to carry out regular checks on these properties as you buy them, this includes gas safety and electrical safety. Both of these can be serious issues, as they can lead to explosions or fires.
You need to have a great team working for you, this includes having certified members to carry out these checks. You can’t do it yourself unless you hold the necessary qualifications. Of course, if you want to save yourself some money then you could always get these qualifications.
If you’re getting started in real estate, then it might be your first time finding a gas safety engineer. Make sure you check reviews before settling on the person you find. They could stay on your team forever and work with you on every project you have.
8. Install Carbon Monoxide Alarms
Getting started in real estate involves numerous responsibilities, and among the most crucial is ensuring the safety of your properties. This is even more important if you are a landlord letting your homes out to tenants, it is actually a legal requirement. However, if you are buying to sell then you could leave this to your buyers. There are many safety reasons to add a carbon monoxide alarm, as this is a silent killer that can’t always be detected until it is too late. Make sure you don’t get cheap alarms from online marketplace as these might not be as sensitive as the other ones you can get your hands on.
9. Remember To Carry Out Inspections
When getting started in real estate, you might opt to manage your properties yourself. If this is the case then you may have to carry out various property inspections from time to time. If you let your properties to tenants then you want to be sure they are taking proper care of your homes. If they aren’t and you find something wrong then you might want to start legal proceedings to get them evicted from the property. You need to follow the right channels for this as you don’t want to find yourself in trouble with the law.
Give your tenants enough notice for these inspections as they might need to take time off work to let you in, or sort childcare so the kids aren’t all running around like crazy little humans.
Hopefully this article gave you some ideas on how to get into the world of real estate. There will be reasons why you should avoid this line of work, but if the pros outweigh the cons then go for it. If this is your dream career then follow those dreams, you will either love it or hate it.
