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Fundamental Principles of Real Estate Investment

Whether you are a newbie or an experienced investor you can never afford to leave the basic principles of real estate investing.

You can use different strategies in real estate to grow your portfolio . The options can involve investing in warehouses, retial shops, bulk retial, shopping centers, apartment buildings, single family homes or motels, taverns etc . Within the property types you can become an expert in lease options, flipping houses, buying mortgagee sales or international investing . But these can never the fundamental principles.

You can use different strategies or methodologies but the fundamentals of real estate investment never change .

In my experience professional investors at times tend to become over confident and flout the basic principles . Unfortunately this results in their down fall . It is in your interest to understand and apply these basic principles to your advantage .

Fundamental Principles of Property Investment :

* You will become rich if you buy and hold property for as long as possible

* ‘Cash Flow’ Funds Your Real Estate Business and Gives You Peace of Mind

* Do not buy on emotion. Investing is about return on investment. Do the numbers.

* Always study the location. It should be easy to rent.

* Buy properties only from motivated vendors

* Buy your properties by using Other Peoples Money (OPM).

* Make Use of the Property Cycle to speed up your growth

* Everything is negotiable. Keep negotiating till you get the right price or walk off

* Educate yourself. There is no greater leverage than knowledge

* Take Action

You will need the mind of an investor to find a jewel investment. Uneducated people use their eyes to find properties . Thousands of people will pass a property and will see no any value in it . It takes an educated mind to understand what is the real value and potential of a property . Knowledge of property investing holds the key to success .

If property is so good then why doesn’t everyone invest in it? It is fear that hold them back . Knowledge to some extent abates this fear . You can never get rid of fear totally . You have to act in good faith and intelligence. You will remain poor if you do not take action . Only through action can you gain experience and confidence

Action is always superior to inaction . When I started out I had no knowledge of real estate investing .My mentor was a very rustic real estate broker . He pushed me hard into buying my first property probably because he wanted to make a commission . The only sensible thing I did was to take the leap of faith and get pushed into buying my first investment property . I have never looked back since. For the first few years I was a ‘street smart’ property investor . I learnt through trial and error .

Believe me take action even if you have limited knowledge about investing . Think big but start small. A few small steps will change the financial out come of your life .

Knowledge and application of these principles will be the key to your success in real estate investing .

My recommendation is that you read the ‘Principlesof Real Estate Investing’ in depth to get better understanding of the subject.

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The author of the article specializes in Auckland Commercial Real Estate

Tags: invest in real estate, residential property investment, real estate investing