A key to investing in real estate, whether for a fix and flip home project or a rental investment, is to research, gain insider tips and take the advice of an experienced mentor.
Be ready to learn. Don’t be afraid to ask questions, whether it’s about repairs, lending, property permits or selling. Advice from a mentor could be the difference between being in the red and making a substantial profit.
Timothy DeLeon, president of the property investment company MarketEdge Homes, says he spent extensive time researching and taking coursework before he became a full-time property investor. With a successful company now on the rise, he most enjoys the sense of accomplishment that comes with a fix and flip property.
Timothy shares his 5 tips on property investing.
5 Expert Tips to Property Investing
- Factor in enough margin to cover unexpected rehab expenses. Something will come up, whether it’s unexpectedly replacing an air conditioner or finding a plumbing problem. Make sure you leave room for the unanticipated. And if you’re lucky to avoid these costs, it’s more profit in your pocket.
- Look for those ‘hidden’ expenses. Expenses or fees, such as a homeowner association fee or wholesaler fee, should be included in your calculations.
- Be conservative in calculations. When determining the price to pay, rehab costs, potential net profit, etc., be conservative to ensure you come out in the black.
- Purchase at the right price. With the housing market rebounding, it’s critical to get the right property at the right price as a property investor. Do your homework. Know the comparables and ensure they’re the right comparables – not new construction. Understand strategy and know how to negotiate.
- Use a lender who understands property investing. A hard money lender specializes in short-term real estate backed loans. They understand the importance of moving quickly, having capital available and being open to properties in disrepair, unlike most conventional lenders. Properties in poor condition are oftentimes the best opportunities for property investors.
Catalyst Funding is a hard money lender who can help build your real estate investment opportunities. With a background in fix and flip projects and other property investments, we can provide resources and guidance to help you through the entire process. We strive to be more than a lender! For more information, call Catalyst Funding at (832) 648-3626.