I'm interested in becoming a real estate investor. How does this field work exactly? Do you buy a house, wait for it to appreciate, and then sell it after 10 years? Or do you buy it and sell it right away?
I'm interested in becoming a real estate investor. How does this field work exactly? Do you buy a house, wait for it to appreciate, and then sell it after 10 years? Or do you buy it and sell it right away?
Why would you want to do something you dont know anthing about? Or do you just want to start a stupid thread to see how many responses you get. Get a life.
ok let me rephrase that. I'm interested in learning about real estate investing as a career. Happy?
I think it is a little late in the game to try to speculate in real estate.
what do you mean?
It's pretty simple. Give me an offer to buy my house for three times what I paid for it and I will sell it to you. Hold it as long as you want! You will like my neighbors too.
As they say, when the cab drivers and posters on letsrun are getting into real estate, it's time to get out. This thread is a true sign of the apocalyptic housing bubble.
All you'll ever want to know about real estate investing and more.
Start here...I have some beautiful land in Flordia that would fit you to a T.
doctor stupid wrote:
I'm interested in becoming a real estate investor. How does this field work exactly? Do you buy a house, wait for it to appreciate, and then sell it after 10 years? Or do you buy it and sell it right away?
Investing in a home is the basic way that most people intially invest in real estate.
Then you can expand by investing in other properties.
House prices were around 50,000 in the early 80's in Seattle, whereas now they are selling for 800,000 and up. Considering if you had put in a 20% down payment of 10,000, about half of that being paid off by this time, your intial investment of 10,000 would now be worth 795,000!!!! Not bad at all.
To learn about real estate investing you could get a real estate license and work with investors for a few years, or study investing on your own, or both.
The important thing is to create a "stash" (i.e. down payment) for investment, and then make the most of it. The less of your own money you use for a property, the greater your potential return but the more risky the investment.
Here are two of the most excellent books on investing in real estate.
#1 all time best:
"How I turned $1000 into a million in real estate -- in my spare time. -- by William Nickerson, 1959, Simon and Shuster.
I got a copy of this book for 25 cents in a used book store some 20 years ago. The principles are just as applicable today as they were then.
#2 and currently in print:
"Investing in Real Estate" -- Andrew McLean and Gary Eldred
3rd edition, 2001, John Wiley and Sons.
This runs around $16 but I got a virtually new copy online for $8 a few months ago. This book does an excellent job at explaning leverage, and all you need to know about investing in real estate.
Beware, many properties are vastly overpriced these days, depending on location. It is important to be very shrewd and patient. I have had real estate agents tell me "hurry, buy now!!!" I say, "why?, why should I?". They say "well it's going to appreciate!". I say, "so? so what?". And I find an agent who's going help me find what I want, instead of just looking for a sale.
There are always going to be properties available.
follow the $$... venture capital is flowing out of real estate and back into startups as well as Asia and Euro funds
if you are thinking ahead that is the way to go, real estate gains now will be small compared to the past 10 yrs
I personally don't think it's a good time to buy real estate. Prices are at an all time high with interest rates climbing. If you buy now you might not even break even in 5-10 years. But it's all speculative, nobody knows for sure, even the experts.
I disagree.
Most people lose big time with venture capital. No one needs it anyway except the companies, since they already can't stand on their own. They have nothing to lose and you do.
Plus 98% of seasoned investors LOSE money by investing in the stock market.
However, everyone needs a place to live.
Real estate will always be a good investment, and begins with owning your own residence.
Agreed ... the big money is selling RE like mad right now. Most of the big deals I am working on are waiting on a sale of real estate to get going.
And J.R., that is the single least-informed and non-factual post I have ever seen on this board. Not a word of it is true.
Please cite your 98% loser source. I've invested in index funds for the last 10 years and am ahead. So is my wife. I guess the 98 people closest to me are losers?
OK, a few words are true.
Everyone does need a place to live.
Allow me to rewrite your post in a factual manner:
Most people (investors, companies, and VC firms) win with venture capital, as long as it is well-diversified and given a proper amount of time to produce returns.
Very few seasoned investors lose money by investing in the stock market, although some unseasoned investors might. Seasoned investors became seasoned by learning from their mistakes and not repeating them, and have been invested long enough to realize significant gains.
Everyone needs a place to live.
Real estate is usually a good investment as long as it is a part of a broader diversified portfolio.
I know that's what you really were trying to say.
J.R. wrote:
The less of your own money you use for a property, the greater your potential return but the more risky the investment.
How exactly does using less of your own money make the investment riskier?
This is pretty darned dishonest, and probably illegal. But I got my appraisal higher from lying about my home improvements, such as new appliances, counter tops, carpet etc... I haven't done anything since buying it, but they marked down that I did plenty.
If it's not your own money is probably debt. In that case, you have higher fixed costs to own the property (e.g., debt service which could be principal, interest, or both). Higher interest expense eats into returns. Also, if you lose tenants at your property (& thus cash flow) it is more difficult to pay debt service.
If you have a high risk tolerance and good attorney and/or significant cash reserves, using leverage is a great way to maximize returns.