Jacques Coquerel
Baby Steps In Real Estate Investing
Copyright (c) 2007 Jacques Coquerel
Real Estate Investing as a Financial Vehicle is based on
the simple principle of buying something for less and
selling it for more. You can buy low sell low or buy low
sell high. Of course, without this factor, sinking your
money in real estate assets wouldn't be much of an
investment, would it? All the factors mentioned above
however make the game a bit more complicated. But armed
with the right initial idea of how to make money in the
real estate business, anyone with enough capital, enough
determination and enough perseverance to learn this
business have a shot at becoming successful in this world.
So what are the key principles of real estate investing?
Value vs. Price. As with any other business, having an
idea of the real value of a property is one of the key
factors in becoming successful as a real estate investor.
Take note however that a property's value is different from
the property's market price or selling price. Value comes
from the worth of the property regardless of whether the
real estate market is booming or in a slump.
Most people who start out in real estate investing bases
their buying decisions on the ongoing trend of the real
estate market. Rising prices for properties in a certain
area are the only green light these people are waiting for
before they buy. Some real estate gurus refer to this as
the "bigger fool theory in real estate investing" that is
selling off the property a few months later to someone
willing to buy it for that price in order to sell it
himself for a profit a few months later. This strategy is
also known as wholesaling. You can make a lot of money with
it. In the tune of several thousands dollars a year. While
this method is still consistent with the basic principle of
making money, the key is to know your value and your
market. Spend time to know the area before venturing in the
wholesale business.
Risk vs The Learning Curve Information is half the battle,
look before you leap and pre-warned is pre-armed are all
apt idioms for those taking their first steps in this line
of business for the learning curve of real estate investing
is pretty steep and those unaware of the dangers are fodder
for the predators in this jungle.
So respect the value of experience and stock up on this as
you move your way up to the top. Always keep your risks
proportional to what you know. Remember that the risks in
any venture are only proportional to the amount of
information you don't have. That is why, when starting out
in this line of business, take the time to choose the
properties with less risk and lower capital outlay first.
Flex your muscles and learn from the mistakes you will make
along the way because believe me, you will make some. This
way, the price for learning the ropes and getting your
education in real estate investing will not be too high as
to take you out of the game.
Also remember, education is not an expense, it's an
investment.
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Jacques Coquerel is a real estate investor based in
Atlanta, Georgia. He has made more than 750 transactions
since 1996. You may visit one of his sites
http://www.reonline101.com and receive a 13-part FREE
ecourse on real estate investing.
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