It simply isn’t good enough to just want to be a full time real estate investor. The most important element is knowing actually how to be a full time real estate investor. If you don’t know how to do it you will not succeed and quickly find yourself back at square one. With just more than 38,000 full time real estate investors in Australia it goes to show that it isn’t a common profession so the odds are against you if you don’t have what it takes to succeed. real estate however is the basis of every business and has the potential to provide you with the very wealth you need to make it as a full time real estate investor.As a full time real estate investor you need to have talent and be dedicated to the real estate investment market. To make it in the real estate investor’s world you firstly need to be a good student so that you know what is happening in the real estate world. This will allow to properly analyze market indicators. You need to be knowledgeable about all of the information regarding real estate investment including updated information on building trends, union activities; Reserve Bank of Australia decisions and the list goes on. You need to be a good reader and dedicate yourself to reading as much about the subject as you can.If you are considering taking the leap as a full time real estate investor it is wise to sit down and write a list of the negative and positive forces which can affect the real estate market. There are more than you think so take your time. After this you can enter the research phase of your new career. You need to be able to understand what will happen if housing purchases are down one month and the effect that this will have on interest rates and even as far fetched as the effect upon building supply prices. The real estate investment arena is a complex and interwoven labyrinth and you need to be able to speculate what is going to occur from one day to the next.Don’t think you can give up your day job just yet though you need to develop the technical skills to interpret all of this information so that you can make cash flow positive decisions. You don’t want to start your career as a full time real estate investor when all of your assets are creating a negative cash flow scenario. You need to be able to stay on top of your finances and identify cash flow trends so that you can plan your future activities.If you don’t stay on top of your finances and make wise decisions from the trends that are appearing you are nearing financial ruin. Finances is the most important aspect of a full time real estate investor because you do not have the security of a full time wage and all of your income is dependent upon market conditions and choices you have made in the past. When you come to the heart of the matter – becoming a full time real estate investor requires four key characteristics:1. Business Skills2. Management Skills3. Financial Skills4. Ethical SkillsThese four skills are the basis for your success as a full time real estate investor. And are discussed briefly so that you can identify whether or not you can gain the skills required or whether you should simply choose another career path. If you cannot adapt to these critical skills then you will not be successful in the real estate investment arena and it is better to find out now rather than later. Otherwise you will have risked everything and gained nothing.Business Skillso An understanding of real estate and investingo A historical appreciation of real estate investment trends and real estate cycles and the ability to interpret future trendso Ability to identify long term prospects of the housing marketo Ability to fiercely negotiateManagement Skillso Ability to deal with people and conflicto Ability to communicate effectively with professionals, trades people and tenantso Ability to display charisma and get people to think the way you doo Ability to manage effective recordsFinancial Skillso Ability to calculate the real return on investmento Ability to increase profits and equityo Ability to Balance your financial books and keep track of expenditureo Ability to calculate the true value of your investmentso Ability to forecast cash flow and debtEthical Skillso Ability to maintain true and correct recordso Ability to meet the needs of your tenantso Ability to openly and honestly communicate with all those who you deal with as a full time real estate investoro Ability to be honest with yourself and make honest decisionsAs you can see there is more to becoming a full time real estate investor than merely just wanting to become one. To take this on as a full time career you need to devote your life to the real estate market and also maintain basic business principles which will help you to succeed even when times get a little bit rocky. Once you gain the understanding that you need you will realize it is not a tricky business to be in, just one that requires time and devotion. People always dream of becoming a full time real estate investor but few ever do. If you meet these skill levels and have a strong desire to succeed then perhaps it is time for you to take the plunge.real estate investing is the way to true wealth. If you remain cautious and rationale there is no reason why you can’t succeed. Don’t just jump in at the deep end though take your time. Start with some investment properties while you are still in full time employment. As you see the cash flow increasing to at least the same level as your wage then start reducing your previous working activities. It is always wise to try before you buy and make sure that this is truly the life that you want to live. Remember there will be some scary times ahead wondering if you will be able to continue but if you have taken all the precautions and show the necessary skills you should be fine.
I’ve had quite a few people interested in how to do “no money down” deals lately. If you’re an average American, the thought of doing real estate without having to put any money into it (and then getting a lot of money out of it) probably sounds really good.It probably sounds almost too good to be true as well…A Word of Warning
I’ve seen seminar companies flowing in and out of cities across the country offering to teach people how to cash in on no money down deals, so I thought this would be a good time to give you a word of warning about what these seminar companies are teaching.What it is and what it’s not
With a basic understanding of how these deals work, there’s something I want to clear up for you. “No Money Down” does not mean you won’t be spending any money on the deal. It just means that you can profit on a real estate deal without having to buy, or put money down on, the actual house.That’s all it means.It doesn’t mean “if you have $0 in your bank account you can still do all the real estate deals you want” like many people assume and (unfortunately) some guru companies are happy to let you believe. It just means that you can receive control of a property without purchasing it.Yeah, you knew there was a catch.The fact is, every deal will take money. If you didn’t put any money down on the deal, then you probably spent money finding the deal.If deal fell in your lap for nothing, then closing or finalizing the deal will take money.And then selling the property or renting it out will take money.What kind of money will you be spending? Occasionally you’ll spend very little, often it will be several hundred, and sometimes several thousand.The Sad Truth
The point is that too many people who are completely broke or deeply in debt hear the real estate gurus advertising “no money down” real estate deals and they say to themselves “No money down? What do you know! That’s exactly how much money I have available to do real estate! I’d love to do real estate if it won’t cost me anything!”So they go to some free seminar that promises to teach them how to do “no money down” deals and they find out that in order to actually learn how to do those deals you have to sign up for the next boot camp. And the boot camp costs–you guessed it–money!So they spend money they didn’t intend to on the next “no money down” boot camp the guru offers, expecting to then be able to do all the real estate they want for no money, only to find out there that the real estate deals do in fact require–once again–money!And if the aspiring investor is completely out of money by that point, guess what they can’t do–real estate!These are the kind of scenarios I and the other investors I work with help people avoid when they’re first getting into real estate.I’m not saying that the gurus are bad people or that you shouldn’t spend money on education (I fully believe that the best money you’ll ever spend is on education). I just want you to be aware that if you don’t have a penny to your name, then “no money down” real estate is not the answer.Here’s the answer–real estate can’t be done without money, but it doesn’t have to be your money that you use. It can be, and often should be, someone else’s money.And that is the key to accelerating your real estate business–leveraging other people’s resources so you can do more than you could have done on your own.My next article will detail how to find money to do real estate deals and (if you need knowledge) even fund your real estate education. Knowing how to find money to fund your activities is an essential skill if you want to be a successful real estate investor.