Of all the different ways to invest your money and diversify your holdings, real estate investing is incredibly popular due to its comparatively low risk and high potential for profit. If you want to be successful, consider adopting the seven habits of highly successful real estate investors listed below.
#1 – They Are Always Learning about the Real Estate Market
If you don’t understand your market, then you won’t understand the best times to buy or sell, the types of renovations you should carry out, or even how much you should charge for rent. The most successful real estate investors in the nation take time out of every single day to get updates on the markets they want to invest in. The National Association of Realtors is a great place to start, and you should also consider networking with a trusted real estate agent in each market.
#2 – They Always Seek Out Networking Opportunities
The world’s most successful real estate investors also make it a habit to seek out opportunities to build their networks. Successful investing involves a crew of experts ranging from real estate agents and contractors to lenders and other investors. Some of the best ways to build your network involve creating a LinkedIn profile, attending workshops and conventions, and even reaching out to various nonprofit organizations in your investment markets.
#3 – They Don’t Overlook the Risks
Real estate investing can be incredibly exciting, but with all that excitement comes the tendency to overlook certain risks or red flags. For example, if a property looks too good to be true, there’s a good chance it is. Don’t let the potential for profit cause you to overlook a serious issue that will eat your budget or prevent you from filling units or selling the property later. Successful investors have made it a habit to always consider risk before they make a move.
#4 – They Read About Investing Daily
If you visit a successful real estate investor’s home, you’re likely to find a wide range of books about the various types and facets of investing. They read about being a successful landlord, get updates to the latest real estate laws and regulations, check the newspaper for vital info about the local market, and even stay up-to-date on the latest mortgage interest rates. You should also make it a habit to read a book, magazine, or paper relevant to your investments at least a few times a week.
#5 – They Always Have a Plan… for Everything
Real estate investing requires intense short-term and long-term planning, and many investors keep journals to help them plan and document their goals. To do it, determine where you want to be in five years, then break that plan down into smaller and smaller steps that you can accomplish this year, this month, or even this week. Not only does this help you better see and understand the big picture, but it also gives you something to work toward every single day – and a way to see your accomplishments as they unfold.
#6 – They Master One Niche at a Time
The best way to learn about real estate investing and improve your profits involves mastering it one niche at a time. Successful investors start out within a particular niche – multifamily rental properties, fix-and-flip investing, or new build investing, for example – and master it before moving on to another. By doing this, not only can you feel more confident in your decisions, but you will already have profitable investments to help hedge any risks associated with dipping your toes into a new project.
#7 – They Have a Trusted Lender
When you stumble across an amazing opportunity to invest and you need to make your move, there’s nothing worse than waiting weeks or even months for financing to go through. All the most successful real estate investors work with a financier that can provide them with the funding they need quickly – and without hassle, too. Ideally, you should work with a lender that exclusively finances real estate investors. Whereas a traditional bank or lender may turn you down, specialized lenders better understand the real estate market and can often see value in a property where other lenders did not.
The most successful real estate investors are those who never stop learning. They understand all the risks involved and actively work to mitigate them. Just as importantly, they have a team of expert real estate agents, contractors, lenders, and others on their side to help them make the best and most profitable decisions possible.