The perfect real estate investment is one that has high returns and very low risks. Only if you know how to make smart choices will you be able to achieve this. The following three things make for an excellent real estate investment to help you get started.
Firstly, you need to find a good return. To invest in the illiquid asset that is real estate, you will have to take money out of your liquid assets. What you should look for is to get the same or similar rate of return. This means that you should find a true cash flow property, and not a money pit.
Applying this to real estate investment, what you are looking for is not appreciation, but rather cash flow. Cash flow is what actually comes into your bank account from your rental properties after you have met your financial obligations. What you should do is leave your cash flow alone, and keep that as savings as much as possible. Plus, your cash flow can increase as rent prices go up over time. If you have a good mortgage construction, where your payments stay the same, this is even better. A good cash flow is at least 20% of the money you get in overall. Spend some time using the internet to work out exactly how much your cash flow is.
These are the great properties you should look for if you want to invest in real estate. The ideal property is one that doesn’t require too much maintenance or management. Unfortunately, it can be quite hard to find properties like this. To find these properties, you will need to invest quite a bit of time. You need to research and analyze and look into the available options. Most of us who are ready to invest in real estate want to do so immediately. Even if you have been searching the market for a long time, you should never invest in a property that you are not sure about. The reality is that if you invest in a terrible property, then you will struggle to every see a return on investment and you are more likely to actually lose money.