Now Is The Right Time To Invest In Real Estate
Start investing in real estate now, and don’t put it off for years. Don’t waste opportunities by waiting until after a market crash occurs.
There are four reasons to invest now instead of waiting for the perfect time.
- The future is unknown. We are long overdue for a market crash, and no one knows when a correction will occur.
- You can make passive income even if the real estate values drop. Passive income is based on monthly rental rates, not the property value.
- Anytime is the perfect time to learn how to set up your real estate business.
- You need to know what a good real estate deal looks like. Buy quality real estate for a reasonable price.
We Are Overdue For A Market Crash
The future is unknown for most things in life. Real estate investing is no different. History has proven that the market usually has a downturn every seven to eight years. Our last real estate market crash was in 2008-2009.
Many real estate investors believed a crash would occur in 2016-2017, but it did not happen. Today’s bad news for consumers is that we are long overdue for a real estate market crash.
This is good news for real estate investors. The economic bubble must pop, and a financial correction will take place. The housing market prices will drastically drop, and the real estate industry will be in a buyer’s market.
Investors have no clue when the market is going to correct. Imagine if the market crashes five years from now. If you do not invest today, you waste five years of passive income. Start investing now because there are great deals out there that will make you passive income today.
You will leave five years of wealth on the table because you waited for a real estate market correction. The investor’s goal is to make at least $250 in passive income per property.
Rental investors don’t worry about property values’ up and down swings. Their goal is to gain monthly passive income through leasing their properties.
Passive income is the rental rate minus expenses. The rental rate is the amount charged per month to the lessee. Costs include mortgage, insurance, property taxes, property management services, and maintenance.
Rental rates and expenses do not change because the property value temporarily drops. Housing prices go down in a recession, and it is the perfect time to purchase multiple properties.
For example, an investor currently has two properties. After expenses have been paid on the property, passive income is $250 each. These two properties have a net income of $500 a month.
The following year the housing market slumps and the investor can purchase two more rental properties at great prices. Then receives $250 each in passive income. The investor now has four properties and earns $1000 in monthly payments.
Another real estate investor bought six duplexes and received $4000 in passive income monthly during the Coronavirus shutdown. Many income streams slowed or ended during the pandemic. Passive income from rental properties continued because housing is a basic necessity of living.
Learn How To Be A Real Estate Investor
To be a successful real estate investor, you must build your foundation before purchasing properties. Your key components are real estate agents, property inspectors, property managers, contractors, wholesalers, and maintenance personnel.
Real Estate Agents
It is essential to purchasing properties in a good market area. This area may not be in the same state where you live. You need a real estate agent who knows the area and state requirements.
Real estate laws vary from state to state and even at the local level. The last thing you want is to lose your recently purchased property due to an avoidable legal issue.
Property managers are your day-to-day management team. You want a team of property specialists to manage your daily operations, even if you live local to the property. They oversee leases, collect rent, and address maintenance or repair issues.
Contractors, Inspectors, and Maintenance Personnel
Having a reliable contractor or two in your investment area can go a long way to meeting building codes and ensuring building repairs or remodels are completed promptly. You don’t necessarily need to keep them on a retainer, but you do need to try to use the same contractors as often as possible.
Quality of work and time management are prime reasons to ensure you consistently use the same contractors and maintenance crew for all your properties in the same area.
You want your business to run seamlessly like it is on autopilot. Ensuring you have teams in place before you purchase the property will help you avoid any pitfalls, meet deadlines, and create smooth transitions.
The wrong way to start a passive income real estate portfolio is to buy the property first and then build a team to oversee the property.
Buying the property first leaves money on the table. The property cannot be adequately leased without a team in place. Your team is in place to ensure you are making money instead of losing money.
Real estate investing for passive income is more than just running the numbers, finding someone to fix it up a bit, and then managing the property in your absence.
Find experts in the specific city you’re looking to buy real estate. Real estate brokers, property managers, contractors, inspectors, plumbers, roofers, and wholesalers know the area well.
Area experts on your team provide greater advice than a database. They are your eyes and ears to the local market. They work for you to get you the best deal, with the lowest price and best quality.
Buy When Market Prices Are Lower
The best value of a property is when the investor purchases it at a great price. Start by studying the market area you are interested in investing within. Then look at the market trends for that area. Focus on a downward trend and purchase the property at a comparable rate.
The strategy is not to wait too long before another investor buys the investment opportunity but to seize the moment of an excellent value for the money. Purchasing power occurs as the economic market declines. Many investors save for the downturn and gobble up quite a few properties at a steal.
Rental Properties Are In High Demand During A Recession
High demand is why seasoned real estate investors purchase multiple properties at lower prices at the beginning of a recession.
Homeowners will sell their homes to reduce their monthly expenses and increase their cash flow. They still need somewhere to live, and renting is cheaper than most mortgages and upkeep of homesteads.
Start building the business so that you have the people in place to find properties when there is a crash. Have people in the area to manage and fix up the properties.
You are prepared to hit the ground running when a market correction happens and meets the population’s needs.
Investors should not feel bad about buying foreclosed properties in a short-sale situation. Many homeowners have over-leveraged their properties and live paycheck to paycheck. It does not take much change in the market to make them lose everything. This is sad but is a “circle of life” effect in the real estate industry.
As the recession releases claws and the market corrects, homeowners will again purchase homes. Some of the properties you bought at the beginning of the downturn can not be resold to the masses. Many times, you are making a small profit.
Visit Wealth Builders to see the step-by-step process of creating passive income through rental properties. Join a community of investors who are a testament that this process works.
Real Estate Investors Need To Know What A Good Deal Looks Like Before Buying
Avoid buying a property you will regret by learning the market. Invest time researching all over the country and in specific cities. Know what properties are currently for sale on daily bases.
Spend every day analyzing properties. There are 50 properties for sale on one day, and then the next day, there are 52. Analyze the two new properties because you already passed on the other 50 properties.
Look for a trend in properties that sell. Comparable properties should show sales prices going up, holding steady, or declining.
Daily analyzing lets the investor get a feel for the market and quickly spot a good deal. Looking at a downward slope in sales makes the buyer aware of a correction or a crash in the market. Prices will soon drop dramatically.
In a market crash, real estate prices can drop by a quarter or even by half the original selling price. Homeowners will need to sell as quickly as possible, thus reducing the selling price. These are the excellent deals you are looking for when analyzing properties.
Join Master Passive Income to learn more about the real estate investing process. Learn how to set up your real estate business. Learn how to earn passive income as a landlord. Last but not least, learn how to read the market and know a good deal when you see one.
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