So you found this blog and you are reading it. Congratulations! Chances are you are considering acquiring a property through a private or “Hard Money” loan, or maybe you are just beginning to learn what is needed to become a real estate investor and are thus leisurely "surfing the net" to see what information is readily available on the topic. It might have also crossed your mind at some point that you want to know why it is that other people invest in real estate. Potential clients often ask us whether investing in real estate still makes sense for individuals. So, we spent a few hours jotting down a few ideas that could become helpful pointers to our readers.
Real Este Investments are usually considered “Safe” investments.
Investing in real estate is generally considered by people "in the know" as a reasonably safe and reliable form of investment, which in the long run, creates positive cash flows and financial benefits and, in most cases, increases the investor's net worth. Another take on the same subject is that some people think it is only available to the affluent (in other words, “to the very wealthy”) or to the brave of heart. Yet, it has been proved time and again that real estate investing is available to all working adults who want to put their hard-earned money to work for them. Of course, the caveat is that you must put in the effort to both, research the right property and do the work to optimize it to sell.
At first, it might seem daunting to delve into the world of real estate investing, with all the paperwork involved (it is easier, for instance, to open a savings account at a bank or a trading account at an online broker-dealer, both of which you should do to put your money to work for you) and all the legal mumble jumble when getting acquainted with buying your first property. Apart from the paperwork involved, an investor needs to learn about financial terms and aspects related to real estate investments, for example: fixed versus variable mortgage rates, down payment as a percentage of a property’s buying price, closing points, HUD-1 formats, title company, private money lenders versus banks, equity home loans, among many other. The point we are trying to settle is: with all that a novice must learn about real estate, is it worth it for regular folks to learn all about these terms so that they eventually may invest in real estate? We certainly think so, or else we would not be in his line of business.
In order to try and convince you that it is worth your time learning about real estate, let us delve into some reasons people invest in real estate. That is, why do they put their money into real estate? Can you make a living from investing in rental properties?
Reasons to consider investing in real estate.
After AMI Lenders has spent decades helping hundreds of real estate investors, financing them with private loans guaranteed by real estate, we can tell you some of the principal reasons many folks choose to invest in real estate:
Using Other People’s Money
- You can acquire property even if you do not have all the money to buy it by leveraging your available capital or obtaining loans from banks or private money lenders (which are more than used to finance real estate investments). And then pay back these loans with the income generated from renting out the property. Colloquially, you are using other people's money to make yours go further.
Long Term Benefits and Tangible Assets
- In the long term, the return on investment (ROI) can be much higher than comparable investments with similar levels of risk. In fact, the more you leverage other people’s money, the higher the
Be Your Own Boss
- You can control your schedule and eventually become your own boss. This is probably not completely true at first. Still, ultimately, many people make an honest living from their real estate investments. Some even claim that their "hourly wage" (calculated as income divided by hours dedicated to tending your real estate investments) can be several times the "hourly wage" of being a well-paid salaried worker. You will thus have time to enjoy your family and friends, on your terms, without having to answer or give explanations of why you are going to a school play to a demanding boss.
You May Do a Lot of The Work Yourself
- You can make use of a full scope of your skills: negotiating a purchase or a lease, administering and budgeting your money, making use of your interior designer skills when renovating a property, and even your manual skills if you decide to do some of the minor renovations yourself. Furthermore, you will probably have to study and learn in disciplines as varied as legal regulations, engineering concepts, and marketing strategies.
Low overhead
- Many investors can run a portfolio of properties independently or maybe run them with the help of a business assistant. You do not need a permanent set of employees, specialized equipment, and/or fancy office premises to run your business. You can assign tasks to specialized contractors on an as-needed basis. You can, in principle, run your business from almost any coffeehouse or co-working station.
You build a Nest Egg for Your Family
- Investing in Real Estate helps you build wealth over time so that, hopefully, you will make your family financially strong should something unpredictable happen to them.
Summary
It is never too late to get into real estate investing. Yet, as with many things in life, you must study and be diligent to be a successful real estate investor. If you are considering investing in real estate in the Houston area, consult with AMI Lenders, Houston's premier private money lender. We are one of the city's fastest closers and could become your financial ally for years to come. We often fund our own loans and move as fast as the law allows. Borrowers in Houston will also have difficulty finding lower rates for hard money or private loans than those we offer. We want our customers to succeed and take advantage of the financial opportunities offered by investments in real estate. Visit our website today and apply for a real estate-backed loan here.
En AMI Lenders hablamos español. Contáctanos si estás buscando un préstamo con garantía inmobiliaria en Houston, Texas.
