Why You Should Invest In Real Estate
Investing in real estate can be highly successful, or it can be a complete failure. Everybody believes that location, location, location is what matters the most, but it is actually more important to know who you are dealing with. Unfortunately, there are some really unscrupulous people in the world of real estate. For instance, those people who tell you that you can be a millionaire on late night television should always be avoided.
The first thing is to find something with a good return on investment. Real estate is an illiquid asset that requires you to minimize on your liquid assets. Try to make sure that the return rate you get is the same as what it was on your liquid assets. This means that you should find a true cash flow property, and not a money pit.
Your investment should also be as low risk as possible. Although there is always a risk in real estate, some options are higher risk than others. Try not to choose private real estate funds, fixer uppers, real estate development and tenant-in-common options. With these options, it is highly unlikely that you will see a positive return. A much better idea is to title interesting properties to yourself. Of course, this takes a lot of research, analysis and due diligence. Do not pick properties that will be highly time-consuming through managing them for instance. Stay away from student rentals, vacation properties