The Effect Of Market Price Fluctuations On Real Estate Investing

Market price fluctuations can affect any real estate investment. The value of the investment is tied to several different factors, including the conditions of the real estate market, the economy, availability of properties, and some other things. Unlike the stock market or some other investment markets, real estate investment values do not rapidly fluctuate. It will not rise or fall a large amount in a short period of time. This means that real estate investors should plan on a long term investment to get the most return for their investment. There can be very profitable real estate investments no matter what the market is doing, but if it is a sellers market you will have a harder time finding a big bargain, and your profit margin may be less.

There are some strategies available to help real estate investors cope with market fluctuations. The first of these is to research your specific real estate market. Try to understand the large scale trends concerning specific individual neighborhoods, national, and regional real estate. Find out about preferred and target neighborhoods, and what streets they contain. Some real estate professionals may be willing to discuss how to interpret any market indicators, like what the average sitting time for houses this month is compared to a past time and what this means for the market. This information can help you make more informed decisions concerning your real estate investments and minimize the risks involved.

Another strategy that real estate investors should be knowledgeable about are real estate inventory trends and how to interpret them. Inventory basically means the number or amount of properties for sale, and this is a very reliable indicator of what the market will do. If there is a low real estate inventory, then it is a sellers market and values will probably rise because of high demand and low supply. If there is a high real estate inventory, then the value of property will decrease because of high supply and low demand. By understanding these inventory trends, the real estate investor can pick the optimum time to buy and sell, which will lead to a bigger return on their real estate investment.

A common real estate investment strategy is to take advantage of falling markets. When property values fall it will take a lot longer to sell a property, and some sellers become very motivated. This is when you can find the great investment deals. Usually the market will rebound after a period of time, and the value will go back up. This allows the real estate investor to have a much greater profit margin.

By following market trends, understanding the real estate market trends and how to interpret them, and taking advantage of falling markets, a real estate investor does not have to be bothered about market fluctuations. These can give an investor a good indicator of what the market may do, and can give a higher return on investments, meaning more money in profits

6 Tips for Taking Your Real Estate Investing to the Next Level

Many real estate investors have come to me with the same concern… they know they need to take their investing to the next level so they can obtain that bigger cash flow they’ve been thinking and dreaming of… but they don’t have a clear plan on just how to do it.

If you have you been thinking about taking your investing to the next level, this article is for you.

Getting your real estate investing to that next level means venturing into new and possibly unfamiliar territory… But, in order to reap those rewards… it’s got to be done. Many investors stick with the same types of deals they did when they first started investing. There is nothing wrong with that… Unless you are looking for that something bigger.

The following is a list of 6 tips to help you take your real estate investing to the next level…

Tip #1: Go After Bigger Fish

Think back to why you first got into real estate investing. I started investing because I wanted to make some serious cash, and I was tired of struggling financially. I started like many investors do-dealing in single-family properties. Then I decided I wanted a better cash flow and I wanted it fast. I went after bigger fish.

Commercial property investment deals offer some of the greatest cash flow and returns for your investment dollar. The number of units, and the size of the properties can bring the largest returns for the amount of time and money you invest in any deal.

Tip #2: Continually Educate Yourself

To get to the next level in your real estate career, you must continually educate yourself. Education and information enables you to find solutions to any challenges that may come up as you’re doing deals. Education also helps to eliminate unnecessary risk. Unfortunately, many investors believe that their lack of knowledge prevents them from doing the tougher types of deals, like large multi-unit residential or commercial properties. It doesn’t take much to get yourself informed and educated. Read books; attend seminars; talk to experts; and never hesitate to ask questions.

Tip #3: Get a Mentor

A good mentor helps you gain practical experience much quicker and more easily then going it alone. Books and courses are important. But a mentor helps you navigate deals, and overcome any challenges you face along the way. Mentors can serve as your safety net for when you head into that real estate investing territory you are unfamiliar with. If you are serious about taking your real estate investing to the next level, a mentor is necessary. A mentor will get there quicker and with much less risk than going it alone.

Tip #4: Utilize a Team of Experts

There are many people who shun the idea of new investors taking on the risk of large, complicated projects like large apartment houses or commercial real estate investments. They are right. Very large investments are not for very inexperienced or novice investors. So why not let the experts be your experts. Your team of experts works to eliminate the risk associated with your inexperience and lack of knowledge. You can get to the next level in your real estate investment career when you put together a team of people with the expertise you lack, people who already know how to navigate their way through a big and very profitable deal.

Tip #5: Develop Marketing Skills

Marketing is necessary for any business. In fact, businesses lacking a marketing system fail. In order to successfully take your real estate investing business to the next level, you must develop your marketing skills and put them into action. A very good way to start marketing your real estate business is by using direct mail. Then, when you begin to receive responses to your direct mail efforts, get yourself networking at places like local investment clubs as well as with bankers and lenders. This is an easy way to get started-take one marketing strategy, learn and hon it. Then start working other forms of marketing (networking, for example).

Your business will get to the next level only when you start learning about and utilizing successful marketing strategies.

Tip #6: Have a Can-Do Attitude

Attitude makes all the difference… especially in real estate. A person who thinks s/he can’t do a deal because it’s bigger than he or she is used to, cannot and will not get his or her business to the next level. The wrong attitude can doom you before you even try. Conversely, a person who is hungry enough for success will attain it simply because he or she doesn’t given up.

No matter where you are with your investing, these tips can help you take your real estate investing (and cash flow!) the next level. Multi-unit residential and/or commercial real estate can definitely be the right vehicle(s) to provide some of the greatest cash flow in the industry.

When you combine education, expert assistance, marketing, and the right attitude, you have the makings for conquering bigger investments successfully, and therefore achieving bigger and better cash flow deals. Your next step is to take action.

Real Estate Investing Basics – Choose Your Neighbor Marketing

A very effective, yet often overlooked method of marketing both your rentals and your houses for sale is door to door flyers in the neighborhood of your property. Residents who live near your property are likely to know someone – a friend, colleague or family member in the market for housing that they can pass your flyer on to. You may also attract the direct attention of a neighbor who is ready to buy or move up/down in their housing.

If you are local and don’t mind running around the neighborhood yourself, this method will only cost you a few hours plus the cost of printing. If you’re not available for the distribution, or just have better things to do, paying someone to distribute flyers is very cheap and incredibly cost effective if it results in a sale or a qualified tenant placement. Just remember to do a quick drive through of the neighborhood to ensure the flyers have been distributed if you’re paying someone to do it.

As for the content of the flyer, it’s worth it to take some quality photographs of the interior and exterior of the home. If your main selling point is the quality of the property, be sure to feature these in full color along with some of the basic specs of the home. If you are advertising a rent to own that’s a really great deal, make sure your analysis of the numbers is prominent and easily understood. Also, be sure to emphasize that this property is in their neighborhood and that this is an opportunity for them to choose their new neighbor. Lastly, don’t forget to include full contact information: your telephone number, fax number, email address and 24 hour recorded information line if you have one.

A more expensive variation of this method is to use direct mail to target your property’s neighborhood. Again, you’ll want to tailor your marketing message to let them know that this is their chance to mold the neighborhood by helping to select the new neighbors. To maximize your exposure, try using both flyer and direct mail distribution methods, timed several weeks apart to make sure that as many neighbors as possible get your message that you have a great property for sale or rent in their neighborhood.