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It can be nerve-inducing to start out investing in real estate. It is a bit of the unknown, but after some success and experience, it will be a lot easier. The key is to take steps to learn about the process so that you can maximize investments and minimize losses or risk. Investing in real estate is an excellent long term tool for building wealth, and you can follow these tips to become successful.

  1. Treat It Like a Business

It is important to treat real estate investing as the business that it is. You should develop a business plan that lists the costs of starting and operating your business. Set goals that are realistic, and make a plan for what you anticipate one, three, five, and ten years down the road. 

  1. Determine Where You Should Look for Properties

It is important to look for the best place for investments. Some people try to stay within a particular geographical range from their homes, but they often miss out on profitable rentals. Sometimes new investors worry that they need to live nearby in case a tenant has an issue or needs a repair, but as long as the property is kept up, this won’t happen often. 

  1. Learn from Other Local Real Estate Investors

Another important tip is to meet with other local real estate investors to learn everything you can. You may be able to find a real estate club where you will meet other investors as well as repair service providers and lenders. This will help you build a knowledge base about the local market. You may even find courses on real estate investing through local real estate brokerages, or you can look for one online. 

  1. Find a Good Realtor

You want a good realtor with a lot of experience to help you locate potential properties. Make sure that your realtor understands investing, and check what they have sold. They should have sold a lot of different types of investment properties, and they should understand basic concepts, such as ROI, NOI, and debt service. 

  1. You Want a Return of More than 1% Per Month of the Sales Price

In the past, a property that could earn 1% of the sales price per month was considered a good investment. Today, you should look for something with a greater return.