The single family home market is very stable, for all of these reasons. They are easy to manage. There are only so many things to take care of in a house, and with a good property management company, that task is made even easier.
There are great tax benefits that come from investing in single family homes. This is not the forum to go into all of them, but make sure you speak to a good accountant who can help you reap this additional benefit of your real estate investing.
Finally, it takes more than one house to build your empire, but with as few as ten of them, you can retire and live comfortably. You have many options available to you. You have your monthly rental income (less any property management costs), you can do a refinance and get tax-free cash based on the equity in the house, and lastly, you can sell whenever you would like. The secret of success in life is for a man to be ready for his opportunity when it comes. – Benjamin Disraeli
Building your team
In order to make your real estate investing more successful and enjoyable, you need to surround yourself with a team of professionals who know the business and have your best interests at heart.
There are several ways to build this team. You can network at meetings, seminars and other events and collect business cards. You can speak with individuals to get a feel for them. Let them know what you are trying to do, and see if they can help you achieve your goals.
You can also look in the yellow pages and the newspaper for additional contacts. Just a note – Yellow Page advertisers may have higher prices than you would like to pay, simply because their advertising costs are built into their pricing.
It is a good idea to speak with people whom you know that are already investing, or simply know people who do the job that you are looking for. It is important to get references, and when you are getting quotes for work to be done, get two or three.
You can also hook up with a company that pulls everything together for you. This type of system is often called "TurnKey" or "Automatic." This simply means that everything has been set up with you, and the service providers have been tried, tested and proven to be true. Many investors prefer this type of system, because it takes the guesswork out of their real estate investing. Here are some of the resources that you can expect to find in a TurnKey System:
Those are the major players that you will need on your team. Surround yourself with good, honest reliable people and you will have a successful real estate investing career.
- Investment Properties – these are typically single family homes, but can be any type of real estate that meets your investing criteria. They should be offered at a fair price, with plenty of equity for you.
- Lenders – this includes purchase money lenders (often called hard money lenders) and mortgage/refinance specialists. Ideally, these individuals are accustomed to working with real estate investors and will have programs that are tailored to your unique needs. You will often find that serious service providers in this arena often specialize in working with investors.
- Appraisers – a good appraiser is one of your best friends in this business. A good appraiser will be familiar with the market conditions and prices and ensure that the house is appraised with a realistic value. In the majority of cases, the appraiser must be approved by the lender. This should make you feel good because it means that the lender is comfortable with the appraisers work and is willing to lend based on it.
- Contractors – there are a wide range of contractors out there. It is important to get a good, reliable contractor on your team. This will allow you to control your costs and your time. When you know that a job will be completed at a reasonable cost within a reasonable time period, you will be able to breathe a lot easier. Contractors who are recommended through a TurnKey System have been through a screening process. While there are no guarantees, this should make you feel better to know that their pricing, quality and timeliness are typically in-line, or they would not be recommended to you.
- Property Management – a good property management can change your outlook on owning rental property. Many people are hesitant to get started investing, because they have heard horror stories from other investors about leaky toilets, midnight phone calls and more. Well, with a good property management company you do not have to worry about that. They will run your ads, interview your prospective tenants, collect the rent, handle maintenance and even send in your mortgage payment, if you would like. This will either be done for a flat fee based on the number of properties that you own, or a percentage of the monthly rent that you receive from the tenant.
Don’t be afraid to make mistakes. Mistakes are how we grow and learn. The important thing is to learn from your mistakes, so that you do not repeat them. More importantly, if you can, learn from the mistakes of others. Hook yourself up with someone who is honest, fair and knows what they are doing.
Congratulations on getting started! Your life is about to go in directions that you have only imagined. Don’t wait another day. The life that you keep dreaming about is really there for you! It is within your reach. Make it a reality by investing in rehab properties.
We wish you much success!
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