Yes, prior wealth will help you when investing in real estate – but it’s not totally necessary. While credit cards, assets, money in the bank, and a good credit score are valuable to have for investing, the best assets you have are time and knowledge. Learn the basic skills needed to find and encourage investors, and set goals to be sure you don’t let them down.
You Need Experience to Invest
Sure, you’ll want to have some knowledge of how the game works, but having years of firsthand experience with real estate is not essential. Learn how real estate investment works by reading up on it, and talking to some people you know (or don’t know) who are already involved. Like everything else in life, real estate investment just takes practice. Once you have some knowledge, just start practicing, and the experience to make you an expert will come naturally.
You Should Own Your Home First
Many investors have actually had great success buying multifamily units before buying their own homes, especially as owner occupants. The requirement is that you must live there for a year; however, once the year has passed, you’ll have already killed two birds with one stone. In addition, once you’ve bought a multifamily home or a duplex first, the next time you want to buy property, it will be much easier to qualify because of the rental income you are already receiving.
You Must Buy Property in a Down Market
It’s true that properties will be less expensive when the housing market is down, but the flipside to that is the lower rents that come with it. Investment opportunities, especially in real estate, can happen anywhere, at any time.
You Need to Have High Earnings to Obtain Financing
This myth is not exactly a myth all the time; often, you will get denied financing if you don’t earn enough. On the other hand, it has been proven wrong time and again. The important thing that must be taken into consideration is rental income on the unit or units you are looking to purchase. Even if the property is vacant during the financing process, structure a rental analysis for the units with an appraiser to present to the lender. This will qualify as income additional to what you are already submitting.
Licensing and Certification are the Very First Step
This myth is one of the main deterrents that keeps people from investing in real estate. Being licensed and certified can be a huge help with real estate transactions; however, it is not necessarily the first step of investing. It can be very useful down the line, and should be taken into consideration when the time comes. There are many ways to invest in real estate in San Marcos Tx without a license and certification.
Real estate investing is very different in every area. Another common myth is that you should invest within half an hour of your home. This is another false one – invest where you can find the opportunities! Real estate investing is all about finding or creating opportunities for yourself, gaining experience, and working with others. Ask your San Marcos realtors, The Damron Group realtors, if you have any questions!