What is your “WHY”?
So, you’ve watched enough DIY episodes on HGTV to know that investing in real estate may be a great way to build wealth and are interested in learning more, but have no idea where to start. There are so many strategies out there: flipping homes, buy and hold, wholesaling, multi-family unit rentals; the list goes on. So which strategy is best for you? The best place to start is by asking yourself some simple questions: what is it that you want to achieve? Are you looking to create a nest egg for retirement? If so, then purchasing a single family rental might be where you start. It provides long-term equity and can supplement your retirement income. Are you looking to supplement your income by a few hundred dollars a month? Purchasing multiple single family rentals to create a portfolio of properties, or purchasing a multi-family building, can provide an additional stream of income.
If you are looking to change careers and make real estate your full-time gig, or generate income to buy cash-flowing properties, then flipping homes might be the strategy you choose. Flipping homes can potentially create a large chunk of capital, which can be used as personal income or as a down-payment to purchase another flip or rental. By figuring out your end goal, your path to real estate investing becomes much clearer.
Another key question to ask yourself: How much time do I have to devote to investing? Be realistic about how much experience you have, what you can do yourself and what you will need help with. Those steps will lead you to Part 2 of investing: How to create the right team to reach your real-estate investing goals.
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Shawn is a local PropertyGuys.com franchisee and mortgage agent in Woodstock and London, Ontario. He is also the President of Veranda Property Investments Inc.