 |
Are you ready to buy your first piece of property, such as an apartment complex, house, condo, or whatever else strikes your fancy? If so, this decision can catapult you directly into an ownership position, which quite frankly might appear daunting at first, due to the high level of responsibility involved. Needless to say, this is a brave leap into unknown waters—the water could feel too cold or look too deep, or the diving board seems a bit too high right now.
But fear not. Whenever we begin new projects or start new experiences, we often feel apprehensive because we don’t have enough information to help us along the way. We hope to ease this anxiety by providing you with all the key information you need, such as:
- how to choose property
- loan and tax advice
- how to improve your credit profile
- qualities to look for in property
- market facts
- hot spots and no-buy zones (dead zones), and more.
It’s important to think about the long term benefits of property ownership. When approached with the right frame of mind, you not only can succeed at owning property but you can also get much more out of it than what you put in. Ownership grants you a lot of power and freedom because you essentially become your own boss, and are limited only by your motivation and imagination. It gives you a sense of goodwill and kindness because so many people depend on you for a home. Ownership generates a tremendous amount of confidence from several avenues such as big sales or proficiency at a new task (e.g. electrical work). With confidence comes experience and the ability to apply it to the future, such as how to deal with fussy tenants, how to repair things, and better yet, how to make more money!
Anybody can succeed with property ownership, but most people never try because they fear failure. But if a 65-year-old immigrant from El Salvador who I like to call “Latin Dad” can do it, why can’t you?
The most important thing is to never lose sight of the main goal of ownership: making money. Remember, this is not a charity—you have to make a living, too. In the long run, you want the property to pay for itself, as well as generate a good profit that you can enjoy for years to come.
So whether you want to jump right into the deep end, or just get your toes wet, let’s make sure you have your ducks in a row.
To begin, here are a few fundamentals you should know prior to ownership:
- Get your credit in shape
- Do a lot of research
- Talk to agents, brokers, individual sellers
- Have a plan (what type of property do you want to buy and where?)
Questions You Should Ask:
Is there another type of investment that’s better suited for me? Will a simple bond or CD generate more profit than this property? (If so, don’t buy this property. But if you insist on buying property, find another that’s priced below its value.)
Will this property pay for itself? (Remember, you have to pay for many things, a mortgage, operating costs, taxes, insurance, and don’t forget about your own living expenses. You’ll need to have some money left over, i.e. a cash flow.)
Are there ways to increase the value of this property? (This is a wonderful benefit of being a property owner—you can directly impact the way your investment grows, which in turn earns you more money.)
What type of property do you want to own?
- weekend or vacation homes
- in-laws (can write off depreciation of the unit you're renting)
- single family homes
- multi units
- condos
- fourplex
- duplexes
- apartment complex
- lofts
TIP: Statistics and numbers are the key underlying factors that determine if you should buy or sell. But be aware that statistics can have hidden elements that hide the whole story. It’s best to do your own investigation, so you can have a closer look and then proceed carefully. Stats can be used incorrectly to sway one sides proposal.
|
|
