4 Rules for Investing in Real Estate

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4 Rules for Investing in Real Estate

[00:00:00] Bigger is Better than Smaller
With bigger deals, you build more wealth, you get economies of scale, you lower your overall transaction costs, and typically lower your cost of funds as well.

[00:00:12] Sooner is Better than Later
Time increases risk. The longer it takes to execute a strategy and generate a return on investment, the more things that can go wrong, investors can back out. Pandemics can shut down the economy. Markets can cycle downward into recession. and Banks can stop lending. There are an infinite number of things that can happen to disrupt an investment. So the sooner you can execute, the better.

[00:00:37] Certain is Better than Uncertain
Uncertainty is literally the definition of risk. The more variables that come into play over which you have no control, the more things that can go wrong. Invest in properties where you have certainty and expertise or information so you're better able to predict the outcome.

You're not sure about the development that's going in next to the property you want to buy? That's a risk. Are you uncertain whether or not the sub-market's largest employer is going to stay? That's a risk.

Create certainty and reduce risk by gathering information, analyzing data, and doing your due diligence.

[00:01:15] Use Other People's Money
People with money to invest are always looking for opportunities for passive income. If you're the one, finding the deals, doing the due diligence, managing the investment, and executing the strategy, you can usually find other people to invest with you. And if they're passive, they'll require a lower return on investment than if they were running the deal.

Also, one of the greatest advantages of investing in real estate is the ability to use leverage banks will put up the majority of the capital needed to invest in, and usually at a lower cost than the return on investment generated by that property. So take advantage of positive leverage to increase your returns.

Using other people's money, will help you do more deals and will spread the risk around. So you don't have to have all of your eggs in one basket.
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#realestateinvesting #realestate #TrevorCalton #realestatefinance #investing

[imranhusain]

You're making good videos buddy, looking forward to many more

[familialfsme]

Trevor Can you please make a video about Defeasance