During a recent guest appearance with Merlin Rothfeld on Power Trading Radio, I was taken aback by the number of questions we received regarding what to invest in, where to invest, and whether or not it was it still safe to invest in Real Estate.
Party affiliations aside, today’s pressurized geopolitical climate has Real Estate as a forefront topic of conversation for many current and aspiring investors. Fueled by recent news that the Federal Reserve is going to hold interest rates through the end of the year, media speculation regarding the potential of another Housing Bubble, and the redistribution of America’s population, is it any wonder?!!!
In the midst of hype and speculation, unlike novice investors, professional investors always defer to process and research. In other words, they do their homework.
What Are Your Real Estate Investing Qualifications?
Since the dawn of time we have all been taught that Real Estate is all about location, location, location. Respectfully, no it’s not. While location may be an important consideration, on an institutional level investing is all about the numbers, the numbers, the numbers. If we are going to deploy capital, what’s our ROI, CAP Rate, DSCR, CADS, CROI. Are you unsure of how to calculate these values, or worse, even what they are? This is exactly the problem! This is why many novice investors who lead with emotion, greed or fear rather than training can find themselves in an unenviable position with a less than desired outcome. So, ask yourself this, what’s your level of professional training?
Why Do You Want to Invest in Real Estate?
Also ask yourself Why; Why are you investing? Do you have a personalized, customized, Real Estate Investing Plan? Are you investing because you need or want to generate more income through short term strategies like Wholesaling, are you looking for fixed month over month income through rental property or are you investing because you are trying to bolster your retirement or establish your legacy plan though the long term hold strategy of commercial or rental property. Or, be honest now, have you been hooked by one of those late night infomercials or attended one of the hotel circus events lured by the prospects of making Big Cash and solving all of life’s problems by completing that one big Fix & Flip deal?
Where Are You Looking for Real Estate Deals?
We must also ask where you are considering investing. Look, Americans are on the move, driven by jobs, taxes, cost of housing and, yes, even politics. As investors, we must acknowledge that all markets are not the same. While there’s profit potential in any real estate market in America, we must dig deeper. Are my investing strategies in line with the markets localized trends? Case in point: while states like New York are seeing a mass exodus of people, cities like Austin, Denver and Atlanta are experiencing break-neck levels of growth. Meanwhile, where California investors and homeowners alike are dealing with sticker shock price levels, markets like Nashville, Charlotte and Orlando still offer unprecedented value and upward growth population.
Lastly, I must ask where are you looking for deals? While retail sites like Realtor.com and Zillow may be fine resources for the average homeowner looking to buy a home, they are not where professional or institutional investors identify off-market opportunities. Even in many of today’s hyper growth or hyper priced markets, there are still an abundance of off-market opportunities if you have access to off-market deals. Proudly, OTA Real Estate has been able to level the playing field for seasoned and novice investors alike with our suite of proprietary Patent Pending tools like the Deal Board and Deal Tracker. These incredible tools afford the opportunity to identify off-market deals locally or nationwide that align with your levels of experience, available resources and local market trends.
I’ll close with this: Investing in Real Estate is still responsible for creating more wealth than any other industry. However, to maximize potential and reduce your levels of risk and exposure it takes world class training, a customized investing plan in alignment with your goals, access to professional grade Patent Pending tools that deliver off-market opportunities, and the support of experienced professionals to navigate the changing landscape of today’s Real Estate climate.
To Learn more about strategies to level the playing field and maximize potential, please visit OTARealEstate.com or reach out to your local center staff.