How to Get an Education In Real Estate Investing
By Steve Gillman - 2007
One way to get an education in real estate investing is to
simply start investing. You are probably glad you didn't try
that approach in the last few years. What can you do to get educated
without risking anything? Here is a quick guide.
Read Real Estate Investing Books
Start by reading anything and everything you can get your
hands on. Some of the books may be out of date, but you still
will learn something from them. You don't have to spend any money
to do this. You can read the books available at your local public
library, and then start on the books in any bookstore that allows
you to sit and read for hours.
As you read more you'll start to get an idea about what kind
of investing you want to do. There are dozens of ways to make
money with real estate (including investing time and money into
a site like this where you can just write about it all). You'll
naturally be suited to some types and not others, both due to
your talents and your situation. You can begin to tailor your
education in real estate investing.
Look Around You
As you read and study what others have done, also start to
look around at what is available where you live. Pick up real
estate guides and browse newspaper ads. When you see a property
that is for sale write down the address and look it up on online
to see what the seller is asking.
It is important that you get educated as to prices in your
area if you are serious about investing. Take notes so you can
compare properties that come and go. This will train you to spot
Play with the Numbers
You should look not just at the prices of properties around
you, but also play with the numbers to get used to how to arrive
at a decision that makes sense for you. Find out what it costs
to close a deal in your area, and what taxes and insurance run
as well. If you are hoping to fix and flip houses, see what it
costs to make typical repairs and improvements, so you can put
it all on paper and see if there is profit potential in a given
home. If you are going to invest in rentals, look at what rental
rates are in your area, and see which properties might produce
positive cash flow after every expense. Buy an amortization book
and carry it with you so you can see what your payment would
be as you look at a house or apartment building. You have to
know how to run the numbers, so practice, practice, practice.
Learn From Others
If there is an inexpensive real estate investing club near
you, join it and start mingling with whoever seems to be making
the most money. Alternately, spend time with members who are
working in the areas you hope to invest in. Write down people's
names and phone numbers if possible. You can make a lot of great
contacts in a club full of active investors.
Find a real estate agent that invests, and talk to him about
what you hope to do. Ask him what you will need to be prepared
and what opportunities are most likely. When the time comes,
have him or her show you a few properties.
Of course at some point your education in real estate investing
will have to include hands-on experience. If you are not sure
you want to do it alone you might consider having a partner for
your first investment. That can be tricky, so be careful. Look
for someone who has more experience than you, and has some success
stories. Make sure everything is spelled out on paper before
agreeing to anything, and have an attorney review your agreement.
If it doesn't feel right, back out before the first offer is
made, and at least you will have added to your education.