Walnut Street Finance Blog

13 Tips to Prepare for Your First Real Estate Investment

Posted by Bobby Montagne on Oct 6, 2016 8:17:33 PM

So, you’re ready to take the real estate investment plunge and take on your first fix and flip, but what's next?

13 Tips to Prepare You for Your First Real Estate Investment | Walnut Street Finance

  1. Study the geographic area of your targeted investment property to ensure that it will sell (or lease up, if applicable) quickly. Several key markers include market conditions, buyer demand, school quality, local employment data, and foreclosure rate.
  2. Find an experienced mentor. It’s always easier to learn from someone else’s mistakes rather than your own.

  3. Set attainable goals and budgets. Be realistic about all costs associated with the investment – transaction expenses, repair & labor costs, carry costs, and marketing budget, just to name a few.

  4. Prepare a Personal Financial Statement (PFS). This as much for you as it is for your lender, as you need to determine what assets you have and what you can afford.

  5. Gain access to the Multiple Listing Service (MLS) to keep fresh tabs on finds in the market.

  6. Interview contractors and make sure you are completely satisfied with your choices. Contractors will soon become your best friends throughout the process.

  7. Develop a comprehensive pro forma to quickly analyze deals. This will allow you to eliminate non-profitable investments efficiently and move on to the next opportunities.

  8. Build a solid team. You’ll need a real estate agent, insurance agent, home inspector, surveyor, attorney and accountant.

  9. Find a hard money lender to close quickly and gain access to construction funds and a mortgage banker for end-user take-out financing.

  10. On the day of acquisition, set your plan in motion.  Preparation is everything.

  11. Conduct at least five property visits per month to ensure the project remains on track and on budget.

  12. Market your property “to the moon and back” and list it before mums are in season.

  13. Expect the unexpected! No project goes 100% as planned, but as long as you go into the project anticipating a few bumps along the way—and budget a contingency accordingly—you’ll be well-equipped to navigate the detours.Building Your Real Estate Empire: Borrower Basics 101




Topics: Real Estate Investing Tips

Subscribe Now for more tips and trends on real estate investments