 There are always a laundry list of tasks that real estate investors need to do in order to ensure they are being a smart, strategic so they can be financially successful in their investing. The problem is that most investors - don't have the time because they work full time jobs and it means they need to spend their evenings and weekends to do those investing tasks. But most investors usually end up trying to shortcuts - which can result in a very very very expensive lesson - bad investing decisions.. Your time is valuable. Time is precious. You only get so much time in this lifetime – it is truly the most valuable commodity you have. And when you work a full time job while also focusing on real estate investing - like most investors you may find yourself struggling with balancing it all. Do this quick calculation in your head by asking yourself these questions
Here is an example to figure out how to calculation based on the questions listed above. Jennifer is paid an annual salary of $75K or $37 an hour in for her 40 hour work week job. She believes it would take her 30 hours to research all the cities in Georgia to help her decide which city to invest in. This means that based on her pay rate of $37 an hour – she is “paying” with her personal time 30 hours which adds up to the cost for her to do the task equaling $1,110 But she has found a Virtual Assistant that can do this for $7 an hour – which means that when she hires them for 30 hours’ worth of work, she is paying them $210 for the task. So by only paying out $210, she has achieved two very important things: • She has freed up 30 hours of her personal time • The task is completed at an 81% discount based on her hourly pay rate vs. how much she would pay a VA to do it. Jennifer can now spend that 30 hours she would have done on that task - on things that she also wants to spend her time on. She can guilt free go out on that girls night, take that yoga class at the gym and spend more quality time with her spouse. And still get the task done! So now you need to ask yourself - can you afford not to outsource and hire a Virtual Assistant. Is it too expensive for you not to hire a VA? Happy Investing, Holly Note: This is an excerpt from our program Work Less...Invest Smarter Workbook (available on Amazon) - where we teach real estate investors how to find, hire and manage virtual assistants to help them be smarter more successful investors.
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Where should I invest in real estate?  You have decided that you really are interested in investing in real estate, but you don't know where to get started so this is the second in a series of blog posts that that we will cover (at a really high level) important questions you need to answer in order to help you choose the right way to invest for you. Simply put, you are more likely to succeed in what you are focusing on if you have a clear vision of what you want to do and how you want to do it.
So now it is time to ask yourself - Where do I want to invest? Based on what you decided above about whether to invest as a passive or active investor – will start to help you figure this out. If you want to be a Passive Investor Your goal will be to figure out what company or investors you will want to work with. Be sure to spend some time investigating looking for companies and people their background, seeing where they invest, how they invest and do they deliver on what they say consistently. This will help you decide if you want to invest with them. Note: these are not all of the questions you will want to get answers to – but they will definitely get you going in the right direction For both REITS (like buying stockholder shares in real estate) and Syndication deals (you are a silent partner on the ownership of a property) you will want to get some answers to questions like the following: + What types of properties do they invest in? + What locations do they invest in – and why? + What has been their success rate so far? + Can they provide customer endorsements or recommendations? + What is their investing or exit strategy? Private Money Loans or Trust Deeds + What types of properties do you want to offer financing on ? + Does it matter to you where (what location) they are investing in properties in? + What rate of return do you want? + What is your exit strategy – how long will you loan them the money for the property? + What proof or assurances do you have that the person you are giving the loan or financing to is going to pay you back? If you want to be an Active Investor – Your goal will be to figure out where (what location) you want to invest. You will need to spend some time investigating (based on your investing strategy and goals) what states, cities even zip codes you will want to invest in. Where you invest decide to investe can define whether you are a speculative real estate investor (guessing this is a good investment) versus a strategic real estate investor (making smart investing decisions based on actual data about a zip or city) For all sizes of Residential Real Estate Investing: Single Family Homes, Multi-Family Homes, Mobile Home Parks and Apartment Buildings + Do I want to invest where I live, in my state but out of area, out of state or even out of the country? + What State do I want to invest in? + Which cities should I invest in? + What zip codes in a city should I avoid based on factors like: high crime rates, high vacancy rates, no cash flow opportunities + Is the local economy healthy (low unemployment, new jobs coming into the area, etc) + Based on my investing strategy, what are my investing criteria? - Buy and Hold for Cash flow vs. Wholesale or Flip for Equity play - Will this area provide the kind of return am I looking for from an investment? For Non Residential Commercial Real Estate Investing: Retail Buildings, Warehouses and Storage Units + Do I want to invest where I live, in my state but out of area, out of state or even out of the country? + What State do I want to invest in? + Which cities should I invest in? + What zip codes in a city should I avoid based on factors like: high crime rates, high vacancy rates, no cash flow opportunities + Is the local economy healthy (low unemployment, new jobs coming into the area, high transitory area, etc) + Is there a need for the type of commercial properties I am looking at investing in? + Based on my investing strategy, what are my investing criteria? - Does it have to be Triple Net? For Land Real Estate Investing + Do I want to invest where I live, in my state but out of area, out of state or even out of the country? + What State do I want to invest in? + Which cities should I invest in? + What zip codes in a city should I avoid based on factors like: high crime rates, high vacancy rates, no cash flow opportunities + Is the local economy healthy (low unemployment, new jobs coming into the area, etc) + What are the land use options for a property? + Based on my investing strategy, does the land meet my investing criteria? - Buy and Hold for equity growth + Can this land be developed – and if so for residential or commercial purposes? + Can this property be divided into smaller lots? + What are the codes, restrictions and zoning details of a property I need to know about? For paper real estate investing: Tax Liens, Private Money Loans and Notes + Are there any places I should avoid investing on paper in? + What are default rates in the area the paper is held like? + What is the history of payment for the paper? As you can see, there are a lot of important questions to get answered to ensure you are making the best possible decisions to make smarter investments. If you are like the majority of people who work full time jobs, you don’t have the time to get these answers to help you make the right decisions, so we recommend you consider finding and hiring a virtual assistant to help you pull together this data. Then you can get the best of both worlds. The virtual assistant can take care of gathering the data you need to make smart investing decisions, while you spend your time with your family or taking a nap on a hammock. |
AuthorI grew up with my Grandfather and my Aunt both doing Real Estate Investing, so it's in my blood. Archives
June 2015
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