Becoming a Successful Full Time Real Estate Investor
This isÂ a continuation of “Becoming a successful Full Time Real Estate Investor.”
Becoming a full time real estate investor means creating opportunities for ourselves on a regular basis to build massive and passive income for ourselves, just like a regular business would. We need to set it up so we can get paid on a regular basis.
We need to do things differently than what amateur â€œconventionalâ€ minded real estate investors do. From my experience, the average real estate investor uses his/her own money for every stage of a property purchase. They continue to put money into a property that is being used for the typical uses such as flipping that property or holding that property for appreciation. Both these â€œstrategiesâ€ end up buying us a job in becoming a landlord or a renovator, and both take way too much time!
There are many investors that â€œinvestâ€ in properties which have a negative cash flow that they are â€œfeedingâ€ monthly.Â Â»The justification is that those properties will someday sellÂ for a profitâ€¦maybe.Â This is a crazy philosophy that has a very low percentage of success.
There are other investors out there that buy property from builders to sell them once they are completed or perhaps after a year of ownership. They are also thinking to make money on appreciation. Does this really work?
Speculation you say?
Yes, occasionally it does, but we are opening ourselves up to far too much risk in terms of any market shift. We are carrying way too much liability and we have a significant amount of money tied up in a property that could be utilized somewhere else. This â€œstrategyâ€, (if you could possibly call it that) is known as speculationâ€¦we can also call it gambling. Any time that a real estate investor is looking toward local economics, in other words appreciation, to be the investment payoff,Â they might as well buy a lottery ticket or go to a casino, because there is not muchÂ difference.
Open to risk
The typical long term hold is subject to the risks of market fluctuations and tenant problems. We could potentially have a tenant move out thatÂ we are relying on to pay part (or all) of our mortgage (as rent) in order for us to have positive cash flow or not have too much negative cash flow. The problem with this is if the tenant moves out, the investor is paying even more money into that property on a monthly basis and thus, the ultimate return on investment, if there is any profit, is usually very low.
Adopting a new philosophy
At Canadian Wealth Builders, we would like the real estate investor to adapt to a completely different philosophy. The investor shall now beÂ in control of their business and their deals, will have the education, skills, techniques, and tools to be able to create a real estate investing business f with little to do with the economic factors to provide the profit. The opportunities the investor creates will provide the profit. It is a much more stable, predictable and lucrative way to do business. Real estate companies use a real estate software to automate important tasks.
So remember, create a business that you are in control of, and are not a victim of.
Canadian Wealth Builders offers many unique, practical, out of the box real estate investor trainings which offer the student hands on, in the trenches style instruction. To find out more, please go to www.canadianwealthbuilders.com
Your success is our business!