Get Real Estate Investing Secrets From Expert Mini Course
Strategies in real estate investing are not a one size fits all solution. For any strategy to work, it must consider three things:
- your investment goals
- time frame and
- risks.
But before shelling out some money for any property, real estate investing experts like Jennie Brown recommend conducting a thorough research or due diligence to learn the following:
- local demographics
- buy and sell trends
- real estate agents in the area
- current and future developments in the area
It is only when you have a clear grasp of all these factors that you are able to determine the best strategies to use, when to use them and contingency plans that help reduce your risks. Just like any other investment, property carries some degree of risk that you will need to meet head on with several contingency plans..
Common investment strategies
Negative gearing: This involves buying and holding property expecting to make huge capital gains from its future sale. Turnaround time for this strategy depends on the timeframe you set for it, usually between 18 to 36 months. As owner, you’ll have to shoulder all taxes, property managing fees, and maintenance fees while holding on to properties.
Cash flow positive: This refers to the rental income you can get from letting others use your property. While prospects for rental properties appear good in populated areas in Australia, it may take you a while to earn sizeable profits from one property considering the current high selling prices of real estate.
Wrapping: This strategy involves buying property for another using your funds in the meantime.. Just like loans used to finance property purchases, you will earn by charging the intended buyer a premium for the funds you provided.
Renovation: This is a growth strategy where you buy property, renovate and sell for a profit.
While property investors typically choose a single strategy and stick to it for all their assets, Jennie believes in using a combination of strategies to reap the most profits using the least amount of time and effort. The problem with the 4 common strategies is that each of these works well only under specific conditions that are sadly missing in the current market.
To make the most out of real estate investing, Jennie recommends subdivision and development, her “patty cash deals” or deals that bring around $100,000 after 1 to 2 years. Learn more of her strategies that require less time and effort from her mini course on “Investing in Property for Profit”.
