How To Make Millions In Real Estate
Over the years, real estate has experienced staggering growth. The prospect that allures people to it is the fact that they can get tremendous returns in a relatively short span of time. Many individuals started from scratch and made a fortune out of it. Some of them even appear on Forbes’ list of the richest people. In this article, I will explain the steps you can take to make a fortune in real estate.
Do You Have That Eye For Property?
A lot of people every year aspire to reach the heights of real estate; however, most of them fall terribly short of their goals. The primary reason is a bad investment. To make a million dollars, you should not just buy every property. You should follow certain benchmarks to reach the top. Following is an example of the benchmarks I am talking about:
- Has to be a multifamily property, with a cash flow following the 50% rule.
- Property must be able to refurbish a minimum of 10% during the first year. This includes a paint job, minor scraping, etc.
- Property’s value will surge by 3% after the first year.
Do not let a great opportunity pass. If you do not have the financial means, there are many alternatives you can choose from to secure immediate short-term loans. The first ever property I purchased was a villa from a family who was moving back to the wilderness of Colorado. I took the help of one of the best bridge loan lenders as I was short on cash. Things went swiftly and the property was transferred to my name in less than 2 weeks. Therefore, it is all about playing smart and not letting the opportunities pass by you.
Use Other People’s Money
Unless you were born with a silver spoon in your mouth, a time will come, when your funds dry up. So, I suggest you seek loans on easy terms and conditions. Beware of the loan sharks though. It is all about studying the real estate landscape and playing your move wisely. Instead of knocking on a bank’s door, you can approach private investors or companies to secure a loan. There are quite a few good hard money lenders in California you can secure a loan from. In case you are not familiar with the term, let me clarify it for you. Hard money lending deviates from conventional lending in that they are issued by private investors as opposed to banks or credit unions. The benefits include few requirements and easy conditions; however, the interest rates are generally higher.
Build Your Network
Have you ever purchased something from a sales representative you had no need for? I recently went to an automobile showroom and ended up purchasing car shampoo, wax, and various other car care products. The reason was simple; I liked the salesman’s personality, his eloquence and the way he gained my trust. Ultimately, I was sold into his personality. Point is if you have a charming personality, are honest in your dealings and can demonstrate profitable investment opportunities, people will be interested in working with you.
Focus On One Strategy
When I started out as a real estate investor, I dealt in cheaper houses exclusively. My game plan was simple; buy out a multifamily house in cheap, renovate it, advertise it and bang. In fact, my name started making the rounds whenever low-value properties were discussed. The lesson is, if you carve your niche and make a name for yourself, investors will one way or the other hit you up.