Real Estate Tips For Beginners
Have you always wanted to invest in real estate but don’t know where to start? Here are some of the different areas of the industry that you can invest in:
Areas That You Can Invest In
Residential: these are properties such as townhouses, apartment buildings and vacation houses. Here a person or a family will pay you in order to live in your property. The length of time that an individual lives in your house depends on your rental or lease agreement.
Commercial: commercial real estate consists mainly of office buildings. When you construct office buildings you can rent them to companies and small business owners. Again the length of time that the business owners use your property depends on your agreement.
Industrial: this one consists of car washes, storage units and any other special type of real estate where customers use your facility on a temporary basis.
Retail: it consists of trip malls, shopping malls and any other retail storefronts. When you construct a mall, you can rent it to a person interested in running it or you can run it yourself.
Mixed-use: this is where you combine any of the above categories into one project. For example, you can construct a storied building with offices, malls and residential areas.
Real estate investment trusts (REITs): this is where you invest in real estate trusts. When the mortgages generate profits, you get a share of it.
Tips on How to Be Successful In The Industry
For you to be successful in the real estate business you need to do a number of things:
Involve an attorney: regardless of the area of the industry that you are interested in always involve an attorney. A good attorney will help you in finding the right construction company. The attorney will also help you in writing professional rental contracts.
Neighborhood: the area where you invest in greatly determines the amount of money that you will make from your investment. To be on the safe side always go for a neighborhood that is growing or has the potential of growing.
Run the numbers: many investors assume that when they construct a building they will have a tenant, which is usually wrong. Before you invest in a building you should run the numbers and find out if you will be able to pay the mortgage if the property sits empty. If you find that you can’t be able to repay the mortgage in the event that the property doesn’t have a tenant for a month or two, chances are that you are stretching yourself too thin.