How to Create a Real Estate Investment Business Plan

Starting a real estate investment business can be a great way to grow your wealth. However, it’s important to have a well-thought-out plan in place before you get started. In this article, we will discuss the steps you need to take to create a successful real estate investment business plan. We’ll talk about setting short-term and long-term goals, as well as how to financially plan for growing your real estate portfolio.

If you’re ready to start investing in real estate, let’s dive in!

Before creating your real estate investment plan, it’s important to know why you’re investing in the first place.

What is your motivation for wanting to invest? Are you getting in the market now to save up for retirement? Are you hoping to become a full-time real estate flipper?

Once you have a good understanding of why you’re doing this, it will be easier to come up with goals, strategies, and action plans that fit with what you want to achieve.

Why create a real estate investment plan?

There are a few key reasons why you should create a real estate investment plan:

To set short-term and long-term goals for your business
Without having clear goals in place, you may be prone to making impulsive or impractical decisions as you begin your investment journey. Use your goals as a barometer.
To figure out how much money you need to save up for your investments
Creating a business plan means getting crystal clear on what out-of-pocket expenses to expect as you grow your portfolio.
To develop strategies for finding good deals and growing your portfolio
Your business plan should have a clear and repeatable strategy you can use to source, acquire, and manage your investments.

Now that we know why a plan is so important, here are the 10 steps you need to follow in order to create a real estate investment business plan.

Step 1: Define your short-term goals

What are your goals for the next 12-24 months? What do you hope to achieve in that time frame? Your short-term goals should be realistic and achievable, and they should help you move closer to your long-term goals.

Here are some ideas to help you get started:

When do you want to buy your first property?
How much do you need to save up for a down payment?
(If you think you need tens or hundreds of thousands to get your first investment, check out BuyProperly. They help investors get started for as little as $2,500 using a fractional ownership model.)
What sort of returns (if any) are you looking for in your first 12-24 months?
What other expenses are you saving up for?

Step 2: Define your long-term goals

Here’s where we get into the fun stuff! Your long-term goals should be even more ambitious than your short-term goals. What do you hope to achieve in the next five, ten, or 20 years? How will your real estate investment business help you reach these goals?

Are you hoping to build a nest egg so you have money for your child’s college tuition? Are you planning on saving up for retirement?

Remember, real estate is a long-term game that works best when you’re prepared to hold onto your properties. When setting financial goals, look at both the potential rental income and appreciation over time to get a better idea of your return.

Step 3: Assess your current financial situation

Before you can start investing in real estate, you need to know where you stand financially. How much money do you have to invest? What is your credit score? How much debt do you currently have? Answer these questions and more in order to get a clear picture of your current financial situation.

Once you know how much money you’re working with, assess whether it’s enough for you to get started (comfortably) in traditional real estate investing.

Make sure you have enough money to cover:

The closing costs (lawyer’s fees, surveys, title search, realtors, etc.)
One-time repairs
Property management fees
Utilities, mortgage costs, and taxes
Ongoing maintenance and repairs

These expenses can really add up, so be sure to factor them into your financial plan. In fact, it’s often this step that makes many people rethink real estate investing altogether.

When new investors check out BuyProperly, they’re often shocked to learn that traditional real estate isn’t the only way to grow a lucrative portfolio. BuyProperly helps people get started in real estate for a small fraction of the cost of traditional investing.

Are you curious about accredited investing?

Accredited investors have special status and are able to invest directly into:

Find out more — Schedule a call with us today!

STEP 4: CREATE A SOLID FINANCIAL PLAN

Now that you have an idea of what you need to begin investing in real estate, it’s time to build out a solid financial plan.

Investing in real estate can be a great way to grow your wealth, but it’s important to understand how to invest and what to expect before you get started.

Anticipate your monthly expenses
In your area, what are average management costs? What about heat, electricity, and water?

Look at potential rental income
What can you expect for a 1, 2, or 3-bedroom rental in your area?

What monthly net income can you expect?
After all expenses, work out what you expect to receive monthly.

What annual appreciation are you expecting?
Look at your local market to determine these rates.

How will you continue to invest?
Will you be able to leverage your current assets to continue growing your portfolio?

STEP 5: RESEARCH THE MARKET

Before you invest in any property, it’s important to do your research and understand the current real estate market conditions.

First, decide on the area you want to invest in. Do you want to stay local or are you open to investing out of your city or province?

Next, take a close look at your chosen area. Are prices rising or falling? What are the current vacancy rates? How much competition is there for properties in your area?

Knowing this information will help you make smarter investment decisions.

STEP 6: CHOOSE YOUR INVESTMENT STRATEGY

There are many different ways to invest in real estate, and each comes with its own set of risks and rewards.

First, do some research and decide which investment strategy is right for you. Maybe you want to buy and hold properties for the long term, or maybe you’re interested in flipping houses for a quick profit.

Next, decide on which type of real estate investment you’d like to start with. Are you looking for single-family dwellings with lower repair and maintenance costs, or multi-family buildings that can yield a higher return but are more expensive to get underway?

Are you hoping to quickly leverage your properties to grow your portfolio, or are you more interested in buying properties that have the potential to appreciate over time?

Having a clear strategy in place before you start investing is the best way to ensure you’ll meet your short and long-term goals.

NOW IT’S TIME TO CREATE YOUR BUSINESS PLAN

Even if you’re not raising funds or seeking outside investment, it’s always a good idea to have a business plan in place. This will help you stay organized and keep track of your progress over time. It can also be helpful when applying for loans or other financing.

Now that you know your goals and what you need to do to achieve them, it’s time to put together a real estate investment business plan. This will act as your roadmap for growing your portfolio and achieving success in real estate investing.

Your business plan should include the following:

– A description of your business

– The goals you hope to achieve with real estate investing

– How you plan to finance your investments

– Strategies for finding and evaluating deals

– Plans for managing your properties

– Marketing and sales strategies

– Projected income and expenses

– A risk management plan

Creating a business plan is not easy, but it is essential if you want to be successful in real estate investing. It will help you stay on track and make smart decisions as your business grows. So take the time to create a plan that is tailored to your specific goals and needs.

With a well-constructed business plan, you can confidently move forward with your real estate investment business and achieve the success you desire.

CONCLUSION

Real estate investing can be a great way to build wealth and create financial security for you and your family. But like any business, it takes planning, hard work, and dedication to succeed.

By following the steps outlined in this article, you can create a real estate investment business plan that will help you reach your goals. Stay focused on your goals, do your research, and take action to make your dreams a reality!

So what are you waiting for? Start planning today and see how real estate investing can change your life.

Learn how BuyProperly helps investors get 10-40% projected annual returns for a fraction of the cost of traditional real estate investing.

in BuyProperly, Editorial Posted by wpengine

April 6, 2022April 6, 2022

Decentralized Finance: How DeFi is Revolutionizing Real Estate

This video explores how DeFi is revolutionizing real estate. You’ll learn:

How DeFi is shaping real estate investing
How DeFi is turning mortgages and lending head over heels
How real assets can now exchange hands via digitized tokens even NFTs

It’s hosted by BuyProperly CEO Khushboo Jha and her guest is Ben Ames, who’s a partner at Forge & Foster, and the founder and CEO at REIF Financial Investments.

in Editorial, Thought Leadership Posted by wpengine

March 9, 2022March 9, 2022

How to Build Wealth in Your 30s: Simple Steps to Become Financially Free

“Financial freedom” is becoming a buzzword nowadays, but what does it actually mean? When it comes to learning how to build wealth in your 30s, patience, persistence, and a solid plan are at the root of this new financial freedom movement.

Here are 6 simple tips to get you started on the road to wealth-building and financial independence.

Let’s dive in!

1. Make a budget (and live within your means)

The first step to building wealth in your 30s (or at any age for that matter!) is to make a budget and stick to it.

Many people never realize how much money they’re actually spending each month and how much could be saved by simply creating a budget and learning to consciously live within their means.

How should you create a budget? Here’s a simple guide to follow:

Calculate your total net income for both you and your partner: make sure to build your budget based on your take-home pay each month.
Calculate all your fixed expenses: this includes all the expenses that are predictable and stay consistent each month like your mortgage, rent, insurance, car payments, etc.
Calculate all your variable expenses: variable expenses include all of your discretionary spending and bills that change from month to month like groceries, dining out, utilities, and leisure activities.
Set aside money for debt repayment and wealth-building: Ideally, you should be able to set aside between 10-20% of your net income for debt repayment, savings, and investing.

If you don’t have any wiggle room in your budget, start looking for fixed and variable expenses you can cut back on. Here are some ideas to keep in mind:

– Are there any subscriptions you’re not using? Netflix, Amazon, and that old gym membership may seem like nothing, but those monthly subscriptions can really add up! Take a look at where you can cut back to save some extra money.

– Are you paying high interest rates on any loans? Credit card debt can cost thousands in interest charges, so it’s always best to prioritize those high-interest loans when repaying debt. If you’re struggling to make a dent in your loan, call the bank and ask what your options are for lowering the interest rate.

– Have you shopped around for new insurance rates lately? Car, home, and life insurance premiums can creep up without us ever noticing. If it’s been a while since you’ve looked into those payments, it may be worth shopping around to see if you can find a better deal.

– Is dining out eating up all your extra cash? After work, it can be tempting to grab a ready-made meal or takeout from a local restaurant. If you’re spending a lot of your monthly income at restaurants, look into cost-effective options like batch-cooking and meal prepping.

Learning how to build wealth in your 30s isn’t always about making more money. Sometimes the quickest and easiest way to find extra money is to take a good hard look at what you’re spending and find creative ways to save!

How much money should 30-year-olds have saved?

There’s no right or wrong answer for how much you should have saved by the time you turn 30 since it depends on your income, lifestyle, and the wealth-building opportunities available to you.

Most experts suggest saving 10-20% of your pre-tax income each month for retirement. According to Statistics Canada, as of 2020, the average salary for Canadians was $54,630. This means $455-$910 would be an ideal amount to put towards savings each month.

If you’re just getting started at 30 and you’re able to invest $900 each month in accounts or investments that yield a 5% annual return, you would have just over $980,000 by the time you’re ready to retire at 65!

2. Pay off debt as quickly as possible

Debt can rack up some serious interest payments that eat into your potential wealth-building opportunities. According to BNN Bloomberg, as of December 2020, Canadians now owe $1.71 for every dollar of disposable income they have to spend.

What’s the hidden cost of high-interest debt? Let’s say you have credit card debt totalling $10,000 at an 18% interest rate. If you decide to pay $200 towards this debt, it will take 94 months to pay off AND cost you $8,622 in interest.

If you decide to increase that payment to $400 per month, your credit card will be paid off in 32 months and you’ll pay only $2627 in interest.

That means you’d be saving $5,995 which could be put towards savings, retirement, or investments that will help grow your wealth over time.

If you’re battling with high-interest loans and credit card debt, one of the fastest ways to pay it off is by focusing on the highest-interest loan first (a.k.a. “The Avalanche Method”). This method for debt repayment frees up more cash month-over-month as you continue paying down those debts.

3. Work on your money mindset

So many have us have been conditioned to believe we can’t be wealthy or that only a select few people are lucky enough to be financially secure.

Although it’s important to acknowledge the privilege of being able to work full time, earn an income, and invest in various financial markets, it’s also important to realize that it’s never too late to start investing and growing your wealth.

The first thing you can do to get comfortable with money is to start talking about it. Open up a dialogue with family and friends about savings and retirement. Talk with coworkers about financial resources available through your employer. Find financial advisors and professionals who can teach you how to build wealth in your 30s and deconstruct some of the money myths you believe.

The quickest way to change your mindset about money is to surround yourself with people, conversations, and thoughts that are different from your own.

If you’re willing to challenge some of the long-held beliefs you have about money, you’ll find new and amazing opportunities to start building wealth and take steps towards becoming financially free.

4. Learn as much as you can about investing

Everyone knows the power of smart investing, but many people are too intimidated to take the first step to get started. After all, where should you put your money? Stocks? Bonds? Real estate?

The fastest way to grow your wealth is to get educated about investing so you can make informed financial decisions.

What can you do to learn?

Read books

One of the simplest ways to learn about investing is to go to the local library or book store to find some books on budgeting, saving, and investing. Here are some great books to start with:
– The Intelligent Investor: The Definitive Book on Value Investing
– The Book on Rental Property Investing
– Investing in Your 20s & 30s For Dummies

Join supportive communities

Eager to dive in and talk about investing? Find local or online communities you can join to learn all about investing. If you don’t have any business clubs in your area, look online on Reddit or Facebook for supportive communities to join. Here at Forge & Foster Investment Management, you can engage with us on Twitter, Facebook, Instagram and LinkedIn.

Speak with financial professionals

Take advantage of all the professional wealth-building advice you can. Book an appointment with a financial advisor at your bank. Talk to your employer to ask about RRSP opportunities. Meet with an accountant to discuss ways you can find more money in your budget to invest.

Attend seminars and/or events

Going to local events is a fantastic way to learn valuable financial skills and network with like-minded investors. Not sure where to find events in your area? Simply head to Google and look for investment conferences, business groups, and meetups in your local area.

The more you educate yourself about money, the more opportunities you’ll find to build your wealth.

5. Diversify your portfolio

Many of us have heard of the saying “don’t put all your eggs in one basket” and this is absolutely true when it comes to building long-term wealth. Diversifying is one of the best ways to ensure you’re protecting your money.

What does diversification look like? Simply put, diversifying your portfolio means investing in a variety of different industries, sectors, and asset classes. This could include stocks, bonds, real estate, currencies, and more.

Diversification is a key component to building wealth because it allows you to spread your money around to mitigate risk and better predict expected growth.

While investing in something like Bitcoin may bring some temporary gains, it can also be extremely volatile. Balancing out those volatile investments with the long-term appreciation from rental properties, for example, would create a more stable portfolio.

BuyProperly helps new investors get started in real estate investing for as little as a $2,500 initial investment. Learn more at www.buyproperly.ca.

Speak with your financial advisor about different ways you can diversify your investments for maximum growth.

6. Remember to be patient

Building wealth doesn’t happen overnight: it takes time, dedication, and patience to see the best results.

One of the biggest secrets to wealth-building is the compounding effect that comes from reinvesting your money over time. The more returns you’re able to reinvest in the market, the higher your earnings will be! This snowball effect is what creates stable, long-term opportunities.

Don’t get discouraged if you can only invest a small amount of cash at the beginning, or if your investments don’t make you a millionaire overnight. The key is to make smart financial decisions that will set you up for long-term wealth and success.

If you follow these simple wealth-building tips, you’ll be one step closer to financial freedom.

Want to learn more about how to build wealth in your 30s? BuyProperly is on a mission to make real estate investing accessible for everyone.

in Editorial, Thought Leadership Posted by wpengine

March 7, 2022March 7, 2022

Multifamily Property Real Estate Investing: The Pros and Cons

Are you a brand new investor ready to start growing your real estate portfolio? Maybe you have a few investments and you’re eager to diversify and learn more about multifamily real estate investing.

No matter where you are in your investment journey, diversifying your real estate portfolio is a fantastic way to generate more cash, reduce risk, and grow your wealth.

If you’re in the market for a new investment, a multifamily property may be the perfect fit for you and your goals. Below, we’ll discuss the pros and cons of multifamily investing, along with our top tips for how you can find your first (or next) multifamily property deal.

What is multifamily real estate?

A multifamily home is essentially a single building that’s separated into units, or dwellings, to accommodate 2 to 4 families. This includes duplexes, triplexes, and quadruplexes.

Anything above 4-units is considered a “commercial” property. A house or apartment with only one dwelling is simply considered a single-family.

According to Statista, multifamily property investing shows no signs of slowing down! In 2023, there will be an expected 5.39 million multifamily properties in Canada, which is an increase from 4.96 million in 2018.

What are the pros of multifamily real estate investing?

Multifamily properties offer some incredible benefits to real estate investors. Here are some of the top reasons you should consider adding multifamilies to your real estate portfolio:

Owner-occupied arrangements

One of the biggest pros of multifamily family real estate investing is the ability to have an owner-occupied real estate investment. This means you can buy the property and live in one unit while renting out the others and collecting cash to pay down the mortgage!

This is a great opportunity to “house-hack” and start building equity in real estate quickly.

More cashflow

Another pro of multifamily investing is that your cash collected will accumulate faster. More units to be rented means more cash, which allows you to reinvest and continue building your real estate portfolio.

Less risk

Multifamily properties generally reduce your risk of full vacancy. Unlike single-family homes (when losing a tenant means you’re at 100% vacancy) multifamily properties give you the opportunity to spread out cash flow between 2-4 dwellings.

This means a non-paying tenant or sudden vacancy won’t hit you (and your bank account) as hard.

Simplified management

Looking after several “doors” under one roof tends to be easier on managers. There are fewer independent buildings to keep track of and less travel required for inspections, emergencies, and general maintenance. This means you’ll save on property management fees, and you’ll have fewer headaches if you manage the property yourself.

Tax benefits

Owning multifamily properties means you can take advantage of great tax benefits. You’re able to deduct maintenance fees and operating costs including utilities, management fees, insurance premiums, and marketing costs.

What are the cons of multi-family real estate investing?

Although there are some incredible benefits to owning multifamily properties, there are some drawbacks that come along with this type of investment.

Let’s go over them in detail.

High market entry costs

Generally, multifamily properties are significantly more expensive than single families which limits many people from being able to start with this type of investment. The price tag is often hundreds of thousands (or even millions) of dollars depending on your market.

Higher degree of management required

Many investors choose to manage single families and duplex properties on their own, but once you start investing in 3 and 4-unit buildings, property management becomes incredibly important.

Great property managers will help keep your units full of happy tenants by filling vacancies quickly, collecting monthly rents, performing routine maintenance, responding to requests for repairs, and conducting regular inspections of the building.

More units means more tenants which, inevitably, means a higher degree of management is needed to keep the property cash flowing.

Expensive maintenance

Multifamilies tend to incur higher maintenance costs. Instead of maintenance and repair costs on one unit, multifamily investors need to worry about 2-4 units! This cost is easily offset by the increased cash flow, but new investors should be prepared for potentially higher maintenance and repair costs upfront.

The good news?

No matter which type of property you choose to invest in, you can do it even with limited cash on hand. Through fractional investing, BuyProperly allows people to invest in real estate for as little as $2500. This means your dreams of adding a rental unit to your portfolio are 100% achievable! Want to learn more? Visit www.buyproperly.ca to get started on your real estate investment journey.

What should you look for in multifamily real estate investing?

The property you purchase should 100% depend on your goals.

If this is your first real estate investment or if you’re hoping to “house-hack” and buy something smaller to offset your mortgage costs, a duplex is a great option. Similarly, if you want to manage the property yourself and keep your portfolio small, stick with a 2-unit.

If you’re working with investment partners, you want more cash flow, or you’re looking to grow your portfolio quickly, consider a 3 or even 4-unit property!

You should also consider how much time and money you’ll have to dedicate to your new investment.

If you’re a full-time investor ready to dive in and you’re not afraid of some hands-on management, a larger building may not seem so intimidating to you.

Many of the investors who purchase multifamilies through BuyProperly are looking for a more “passive income” project where they can grow wealth and see returns without having to be involved in the day-to-day management. If that sounds like you, sign up to view a list of their available properties.

We’ll talk more about how to evaluate multifamily properties in a moment.

How to find your first multifamily real estate deal

If you’ve weighed the pros and cons and decided multi-family real estate investing is the way to go, it’s time to find your first property deal!

The first thing to do when you’re looking for the right multifamily property is to contact a local realtor. They often have connections, opportunities, and deals that aren’t listed on public websites. They also tend to have great networks with other investors who may be interested in partnering with you.

Second, join all the local networking groups you can. Find Facebook groups, forums, and local meetups to connect with other investors to talk about real estate. Some of the best deals can be found through word-of-mouth and networking!

Third, consider investing out-of-town. If your local market doesn’t have a lot of availability or it’s too expensive, consider expanding your property search to neighbouring towns and cities. With the right management company, out-of-town multifamily investments can be incredibly lucrative!

Ready to invest in your next property deal?

BuyProperly offers people an opportunity to get into the real estate market using a fractional investing model. This means you can start with as little as $2,500 and see projected annual returns of 10-40%. See a list of their available properties right here.

How to evaluate a multifamily property for sale

Unlike single-family properties, multifamily units tend to be more complex and there are several factors to consider when trying to figure out whether or not to make an offer on that listing!

Here are some important things to keep in mind:

Total units

Does the multifamily property you’re considering have 2, 3, or 4 units? How does this fit your goals? Keep in mind, larger properties may come with a larger price tag but they also yield higher returns.

It’s also important to know your local rules and requirements. In some areas, triplexes and quadruplexes must be registered with the city and cooperate with additional yearly inspections. Speak with your local realtor and city officials to learn more.

Potential cashflow

Cash flow is everything and all potential investors need to have a realistic picture of how much money they can collect every month.

How much rent are tenants currently paying each month? Also, how much rent could you potentially charge based on the condition and location of the property?

Operating costs

Cash flow is obviously incredibly important, but it doesn’t mean much if the operating expenses put you in the red each month!

Make sure to collect information about all the ongoing operating expenses for the property so you can properly calculate your net profit. This includes taxes, utilities, insurance, management, etc. Don’t forget to account for potential vacancies in your calculation (it’s a safe bet to assume a 10% vacancy).

Repairs needed

When assessing whether or not to buy your next multifamily, it’s important to carefully consider all upcoming repair costs. Because multifamily buildings tend to be larger than single families and have more units to take care of us, those upfront costs are normally higher.

When purchasing, make sure you have enough money in the bank to make the necessary repairs to keep your new tenants!

CAP Rate

Calculating Cap Rate is important because it tells you how quickly you’ll be able to pay off your investment. It’s a quick snapshot of your income and expenses as they relate to the price of your property.

Here’s how to calculate it:

First, find out your gross income (rent) each month and multiply it by 12 to get your number for the year.

Next, subtract all of your operating expenses for the year. This will give you your yearly net operating income.

Gross income – operating expenses = net operating income

Now, divide the net operating income by the total purchase price. Multiply this number by 100 and you’ll have your Cap Rate. The higher the Cap Rate, the higher the annual return on investment, and the quicker you’ll make your money back!

Generally, most investors like to stay above a 4% Cap rate. This varies from person to person and it’s important to consider your personal goals when using Cap Rate to assess a real estate deal.

Location and rental potential

The location of a building plays a crucial role in assessing its’ future cash flow potential. How desirable is the area? Is it near schools, shopping malls, and other city services? How is transportation to and from the location? Are there any plans to develop the surrounding area OR add neighbourhood features that would make the property even more attractive?

Location is everything and it’s an important consideration when buying your next multifamily property!

Conclusion: Should you invest in multifamily properties?

Multifamily real estate is an incredible opportunity for both new and seasoned investors.

These deals can help you grow your portfolio quickly, provide increased cash flow, and reduce your vacancy risk. You’ll also be able to take advantage of some great tax benefits.

But, multifamily isn’t right for everyone. If you’re prepared to handle multiple tenants (or pay a property manager who can) and you’re not scared away by higher operating costs and maintenance fees, you should strongly consider adding a duplex, triplex, or even quadruplex to your portfolio!

Want to learn more about how you can start investing in real estate for as little as $2,500? Schedule a call with BuyProperly to learn more!

How to Become a Real Estate Investor: A Step-by-Step Guide

Are you wondering how to become a real estate investor and start growing your very own property portfolio? We’re diving into the nitty-gritty of what it takes to find your first property deal and build a lucrative real estate investment business.

Real estate investing is on the rise and now is a great time to get into the market. In fact, according to an article in The Globe and Mail, investors account for one-fifth of all home purchases across Canada!

If you’re brand new, investing can feel overwhelming, but there are a few simple steps you can take to set yourself up for success. With a clear plan and the right strategy, being a real estate investor is incredibly exciting, rewarding, and lucrative.

What qualifies you as a real estate investor?

The great news is that you don’t need any special credentials or qualifications to start investing in real estate. Many people choose to get their real estate license so they can get commissions on sales and find private deals, but this is absolutely not mandatory to start finding great property deals.

Even though you don’t need specialized qualifications, it’s important to educate yourself as much as possible on the world of real estate investing so you can become an expert in your field.

Is it hard to become a real estate investor?

Building a lucrative real estate portfolio isn’t incredibly difficult, but it does take time, effort, and patience. New investors should be prepared for a learning curve as they figure out how to navigate the market and build the connections that will help them succeed in the industry.

If you’re brand new to real estate, BuyProperly has opportunities for investors to jump into the property market without tons of money (or risk!).

How? Through fractional real estate investing, BuyProperly offers people the chance to own properties for as little as $2500 with a 10-40% return on investment! Want to learn more?

Now, let’s dive into the six steps you’ll need to follow to become a successful real estate investor.

Step One: Educate yourself about real estate

As a new investor, there is no shortage of concepts, terminology, tricks, and lessons to learn about real estate. The single most important thing you can do is educate yourself.

What are some ways you can learn more about real estate?

Read as many books and articles as you can on the subject
Attend local seminars and meetups to discuss real estate with investors, realtors, and brokers
Find supportive online communities. Sign up for the BuyProperly email list

Your real estate education is an ongoing process that will change and adapt as you become a more confident investor. Be open to meeting new people, making connections, and learning as much as you can!

Step Two: Get crystal clear on your goals

There are many different paths you can take as a real estate investor that depend on what short-term and long-term goals you’re trying to achieve.

The best thing you can do before getting started is to sit down and write out your 1-year, 5-year, and 10-year goals. Remember, real estate should be a long-term investment that not only generates some cash flow, but also appreciates in value the longer you hold onto it.

If you’re looking for instant returns and a quick exit strategy, real estate and rentals is probably not the best investment to start with.

Here are some questions to ask yourself:
– why do you want to become a real estate investor?

– do you want real estate to be a full-time profession or a more “passive” investment strategy?

– what financial goals are you hoping to achieve in the next 1, 5, and 10 years?

– are you prepared to adopt a “buy-and-hold” strategy with your real estate portfolio?

– are you more interested in monthly cash flow or long-term appreciation?

If you’re not in a position to put a 10% or 20% down payment on a property, consider working with partners or starting with a fractional ownership model. At BuyProperly, their investors start with as little as $2500 and see projected annual returns of 10-40%.
If you’re interested in learning more, visit www.buyproperly.ca

Step Three: Nail down a location and property market

Deciding on which location you want to target is an important part of building your real estate portfolio. Are you planning on investing in your local area or would you consider expanding your search to include neighbouring towns and cities?

When looking for areas to invest, focus on locations with job stability, nearby schools, facilities like parks and recreation centres, predictable rents, and opportunities for economic growth. Remember, you’re building up a real estate portfolio for short-term cash flow AND long-term appreciation, so make sure you choose a stable location.

If you’re willing to purchase investments outside your local area, you can often find great deals in smaller cities and various up-and-coming housing markets! At BuyProperly, they help investors across Canada find rental properties through fractional ownership. Investors can be 100% remote.

Step Four: Start building your network

Many real estate investors attribute their success (at least in part) to having an incredible network behind them.

One of the most important things you can do as a new investor is to start making connections with other investors, local realtors, lawyers, and brokers. These people know what’s going on in the housing market and they often have access to insider opportunities before the public finds out!

Not only will this allow you to take advantage of off-market deals and get a leg up on the competition, but you’ll also have the confidence and knowledge you need to make smart financial decisions. Having a great “team” by your side will make the process go more smoothly.

Step Five: Learn how to assess properties for sale

When you’re trying to figure out whether or not to purchase a property, there are many things you should keep in mind.

Here are a few examples to consider:

Income potential: What is the current rental revenue and is there an opportunity to increase that? Are there improvements that could be made to the building? Is the rent lower than the average for the area?

Expenses: What are the ongoing expenses for the property? How much is heat, water, and electricity? What will your insurance costs be? Don’t forget about potential vacancies! When analyzing property income, assume a 10% vacancy rate for the year.

Repairs: Are there any significant one-time repairs that need to be done on the property? How old is the roof and windows? What’s the age of the hot water tank and furnace? Factor in all one-time repair costs when analyzing your budget.

Management fees: How will you be structuring property management? Will you be handling it yourself or hiring a company to collect rent, find tenants, and perform routine maintenance? Factor this into your expenses.

Location: We’ve already talked about the importance of location, but it’s crucial to analyze the location for every single real estate deal you make. In some cities, adjacent neighbourhoods (and even streets) may seem similar, but they actually have significantly different average monthly rents and property appreciation.
Ask your realtor or property broker for more information on how you should analyze rental properties.

Step Six: Dive in and make a deal

It’s true what they say: practice makes perfect. No amount of books or real estate seminars can replace the knowledge you’ll get from jumping in and taking action.

Remember: there’s no such thing as a perfect property. Being a real estate investor means analyzing properties carefully, weighing the pros and cons, and making a decision based on your goals and investment strategy.

Don’t be afraid to get out there and start looking at properties, putting in offers, and making deals.

If you’re ready to invest in your first (or next) rental property, be sure to check out BuyProperly’s available listings here. You can get started for only $2,500.

in Editorial Posted by wpengine

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