As a youth, there are various ways you can start investing in real estate depending on your job situation, financial history, credit score among other aspects. Therefore, there are several aspects that as a real estate investor you should follow; especially if you are new to investing.
As a millennial, here are a few ways that you can start preparing for your first real estate investment.
Related: Investing in Real Estate- A Goldmine of Riches
Work on your credit score
Investing in real estate isn’t something you can start doing out of whim. There are important steps that you take before you buy your first property such as having a good credit score.
Fortunately, when it comes to hard money loans, your credit score isn’t as important as it may be if you were applying for a traditional loan. Hard money lenders generally look at the value of the property and not at the borrower’s finances or credit.
However, paying off all of your loans and having a solid credit score will give you an advantage.
Start saving
There are plenty of ways to get financing for your real estate investment, but having proof of consistent saving will help when finding a lender.
Successful investors start saving a certain amount until their first purchase. Doing this will also teach you the value of your money and self-restraint. This can be difficult if you have other loans.
Related: Traits of Successful Real Estate Investors
Don’t doubt your capabilities
Every investor has to start somewhere and you shouldn’t let your fear of failure get in the way. Failure is a part of life and it is a big part of investments. There are always risks, but if you do your research, you can help to minimize your risk and start making money.
You’ll make mistakes, but you’ll learn from them. The important thing is to just get out there and start investing and you’ll learn the rest along the way.
Start networking
An important aspect of investing is getting to know the right people. Meeting with real estate agents, contractors and other investors will help you learn about the industry and you will make important contacts along the way.
When it comes to real estate investing, you will want to have a solid team of people that you work with and you can start building that team before you start investing.
There are plenty of real estate investment organizations, events and meet-ups all over the country and you can find them by searching online.
Follow your head
It’s easy to base your decisions on your heart instead of your head, especially when it comes to real estate. A property may look perfect on the outside but it may not be all it’s cracked up to be. Getting professional advice is always a smart move when it comes to buying a property.
A real estate agent to help you determine if the property is worth the money and effort. There are plenty of things beneath the surface of the property that may cost more money than you think.
Get help to determine how much you will need to spend on the maintenance and repairs before you buy the property. After all, investments aren’t about gut feelings, emotions or following your heart; it’s all about doing the math.
Study the market
Buying and selling the house is the shortest and most exciting part of the investment. But before you even step foot on the property you plan to buy, you need to do your research.
You can start by finding your price range and seeing what homes in that range sell, how long they take to sell and how many times the price was reduced. You can do this by looking at home prices on websites like Kenya Homes.
When looking at the neighbourhoods and real estate market take into consideration: the crime rate, public transportation or schools. Planning and researching as much as you can help to minimize risk and that means more money in the long-run.