One last advantage of investing in real real estate has intrinsic value to it. The stock you purchase can lose 99% of its value . But it's almost impossible to purchase the property and lose almost all its value. A disadvantage to investing in properties is that if you purchase an asset and you are unable to pay the mortgage payment, you can take the property away and harm your credit. Another issue with investing in properties is, as an investor you depend on a number of other people to take care of their own. If the individuals you are renting out to do not pay their rent, you'll have to borrow the security funds and locate new tenants fast or it will take away the profits.
Another drawback of buying a property is the cost it takes to keep or repair. When you think you're done with the property there's a chance that something breaks or requires to be replaced. Investing in properties does have its advantages and disadvantages. If you use the information that you have read, you'll be aware of the pros and cons are.
I watched my husband race around like he was competing the show The Amazing Race, only it was the real-life version.
We'd spent several months exploring different properties, conducting market research and studies; finally we'd located two properties that fulfilled our needs. Each one was in good state and priced to sell. We were thrilled to locate two excellent potential deals.
Our goal was to buy both (one single family house and one duplex). The plan was successful initially, but then the issue was discovered with our investor partner.
In the beginning we thought we could swiftly get over this problem by simply acquiring new partners. The dilemma: any potential partners would have to decide immediately since there were just 48 hours left. It's not difficult to choose to invest $500 over the course of a weekend, however, $50,000 requires a lot more planning and negotiating. My husband and I decided to attempt to make it happen , because we believed fully in the possibilities of the investment.
For two straight days we took phone calling after calling looking for someone with the curiosity and resources to partner with we on our deals. When we got to the end of 24 hours we were ecstatic...we'd identified two new investors that were interested in joining us.
Next step: create the financing.
Along with my husband I, we'd discovered a doctor and a veterinarian to partner with us. With several wealthy and high net worth individuals on our team , we believed the process of securing funding would be a easy task - but we did not realize how wrong we were.
I began by saying it, but then I'll repeat it:
The investment in Real estate can seem easy, however it's not always easy.
I am always disturbed by the ads that claim to offer "instant riches" through real property investment. They purchase videos as well as books and attend seminars thinking that with little effort they'll be able to become millionaire real estate tycoon - the opposite is true.
Let's get back to our story: Dave, my husband, was in a race against time , trying to get to his destination. As you can see, the moment we found our partners, that was the moment when the real problems started. Neither of them qualified for loans to purchase the property. At this point , the sole option was to request an extension, which we received (only 4 days) after which we set out to find the next opportunity and secured private financing - so we went back to the phones!
For the past four days we called everyone we knew looking to raise the funds required. Then, when the time was up, we had everything we needed but there was a problem. The cheques required were more than 7000 kilometers away in Kelowna, BC. Unfortunately we were within St. John's, Newfoundland with 48 hours to get the cheques there on time.
After a lot of examination, we realised that our options were limited. In the end , we decided see if we could take checks to the Post Office in order to get them delivered the next day and that was our deadline day.
We discovered that we were given less than 30 minutes to make it to the Post Office before the courier left for the evening. Since this was our only option, we feared we may have put aside the option to ship overnight.
This is where we start the tale with Dave taking the frantic trip listings to the post office. Luckily, he arrived just in the time.
I'll admit that not every deal does not have the same amount of drama and suspense. But the lending landscape has changed drastically in recent months and financing your investment is going to be very difficult. Those looking to invest in real estate may find the many of the financial programs that used be offered have been eliminated. Both conventional and private lenders can be really exact when it comes down to protecting their capital investment.
Letdowns and disappointments is a part of the game of investing in real estate; if you are disengaged easily, select a career with less risk. You must be determined to be successful in real estate investing.
The truth is both veteran and new investor make the mistake of thinking that investing in real estate is a way to 'get rich quick'. The truth is that real investment in property is a great opportunity to become rich but there's some work to do!
Real estate investing is quite simple. By following a set of tried and proven strategies, you'll get results if do not give up. However, it'sn't easy. Anything that sounds too good to be true , probably is.