Do you want to start investing in real estate , but don’t know where to start? In this article, I’ll tell you my 7 Rules for successfully investing in real estate.
In these years of investing in real estate , I have noticed that there are some rules, which are always true in all markets.
I have completed real estate transactions throughout Italy and abroad and I assure you that these rules also work in the real estate market.
There are 7 golden rules , follow them for your advantage and profit, ignore them for your own risk:
1) Money is made when you buy a house, not when you sell it
If you buy at a discount, you’ll never go wrong . You may not buy the most liquid property in the world, but when you have the margin to sell it, everything becomes easy.
Conversely, if you buy with a small discount or at market price because “the market is going up” you easily find yourself with the match lit in your hand.
2) Always buy from a motivated seller
Who is a Motivated Salesperson?
Someone who wants to sell, or a person who no longer wants to keep that property, for whatever reason. In short, don’t waste time with someone who clearly has time or money and wants to make the most of it.
Look for someone who doesn’t have time and maybe not even money. He will definitely be motivated!
3) Fall in love with the deal, not the property
It happens that you like a property, maybe even a lot. From that moment you can no longer be objective.
But remember that it’s never the property that makes you money, the real estate can’t be placed in the bank.
It is the business that that property represents that makes money. Always focus on the deal, never on the property.
4) Learn to negotiate the price of the property
You need to learn the basics of negotiation in order to effectively negotiate the price of a property. However, a simple rule is this: NEVER SAY THE PRICE FIRST.
It’s a rule of thumb that works for all sales opportunities , not just real estate. the first one to mention a price will eventually lose .
The same property can be worth very different prices (up or down depending on whether you are selling or buying)
It basically depends on your ability to negotiate.
Real estate investing is a business to do with debt. Investing in real estate with your own money nullifies the advantages of this type of investment.
So always try to buy with as little money as possible , or better yet, with zero of your own money.
Offer very low deposits ( start from hundreds of euros ) and make purchase offers that you consider embarrassing ( at least 30% below, better 50% and then negotiate ).
Remember rule #1 of real estate investing: Money is made when you buy, not when you sell.
Investing in Real Estate Discover the FastFlipping™ method that I use to invest in real estate and earn 30% per transaction.
6) In real estate capital first, Cash Flow later
I have written many times and repeated in my courses the importance of cash flow . Cash flow is the good health of a business. You may have a profitable business, but if your cash flow is negative you will easily go belly up.
With real estate, the cash flow is made by “making income” , by renting. However, in Italy it is very difficult to have a positive cash flow if you rent a property on which you are paying a mortgage.
Instead, you’ll need to create capital through trades and then use that capital – along with leverage – for larger deals that will have the goal of generating cash flow.
7) The real estate investment of your life happens every week
Real estate deals always exist, in every market period and in every market. If anything, the problem is finding them. But to start finding them you have to start believing that they are there ( because there are, I can guarantee you ).
If you start out believing you can find homes at least 30% off , with financing options that work for you, and easy, profitable selling opportunities, you’ll start to find them.
Every week there will be at least one chance to make a real estate deal.
So if what you’re dealing with doesn’t fully convince you, believe me, the sea is full of fish. Move to the next property.
Seven rules that are truly the foundation of real estate investing . And if you decide to become a real estate investor, it will come naturally to you.
And as you can see, they are simple and based on what can be called “commercial intelligence“ : buy low, be good at negotiating, don’t fall in love with the products, but with the wealth that the products bring you when you sell them!
To your Financial Freedom