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Achieving Success in Real Estate Investments

Today, an increasing number of people are investing in real estate properties, and for good reason. Now that stock exchanges are no longer becoming profitable, people are going back to real estate. A lot of first-time real estate investors go with single family homes. This has become very common because majority of them have become familiar with buying a home even if real estate investments can be done without owning a home. Also, the learning curve is just slim. However, there is a downside to this approach. For starters, the competition is heavy. Also, first time home buyers are being discouraged by investors who are doing something to drive up the cost of properties for sale. When this happens, for sure, the real estate bubble bursting is about to happen.

So, what are the things that you should do in order for you to not be in these types of situations and invest in real estate successfully? What are the things that you can do to stay on top of the competition while making sure that you are just prepared in case something bad happens to your investments? To answer all these questions, you should invest in commercial real estate.

Why commercial real estate? You see, when you invest in commercial real estate, it does not matter if the local real estate market is having a good time or a bad time. You still get the kind of profit returns that you should expect on a regular basis. What is being referred in this article as commercial real estate in multi-unit apartment buildings.

To answer questions forming inside of your head, here goes. Yes, you will become landlord but no, you will not have to do all the work yourself. You will only serve as the owner of the apartment and never its manager. Part of your expenses include the managing and owning costs of the building that will just be covered by the income you receive from rent.

You can refer to apartment buildings as commercial real estate if they come with five or more units. So that you can make the most of this type of commercial property, you can either invest in bigger buildings or own multiple small apartment buildings. This ensures that your expense to income ratio will generate you a positive cash flow. Becoming an investor of rental properties should be all about getting positive cash flow.

If you are planning to invest in commercial real estate, you should not be too fast in making deals and getting deals. You have to learn as much as you can about the market first. Keep in mind that in this particular area of the industry, you are dealing with professionals. You should never be too obvious that you are an amateur in the business because you will just end up wasting the time of your potential tenants. Also, keep in mind that if you do not have any real estate investment experience, you might not be able to borrow some money from commercial real estate lenders. So, start learning more about commercial real estate first and read some books about making such investments before testing the waters.