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04-14-2010, 02:32 AM #1
- Join Date
- Apr 2010
Successful Real Estate Investing Tips
• It is vital to study all the related documents of the property before investing, to see the license of a broker if any, to check for liabilities etc. All contracts have to be in writing.
All details such as the names of all parties, address of the property, purchase price, area, etc. have to be entered in the contract along with the signatures of all parties.
• It is also prudent to hire a property lawyer to look into the intricacies of real estate contracts.
• Compare Property Values and Rents: Do not rely heavily on financial statistics, instead always measure nearby properties sales and rent price. Financial statistics only go so far; the best measure of a property's market value is often the sale prices of nearby properties.
The same holds true for area rents. A low price can often be justified by a reasonable rent; renters who can afford a high rent can afford to buy instead, so reasonably priced rent is a requirement.
• Assess the tax situation: Taxes are an essential part of successful real estate investing, and they often make the difference between a positive cash flow and a negative one.
Know the tax situation, and see how it can be manipulated to your benefit. It may be a better idea to consult a tax advisor.
• Make sure your property have insurance. You do not know what future risk lies ahead, so it is better to "prepare the umbrella before the rain". Do not forget to investigate your insurance coverage.
• Be cautious - Tax laws may change: Don't base your tax investment on current tax laws.
The tax code is frequently changing, and a good investment is a good investment in spite of the tax code. The right property with the right financing is what you should look for as an investor.