Beware of the real estate investment guru seminars. Many real estate investors like to attend seminars to gain knowledge in hopes of increasing their profit. And it’s not hard to find an “expert” trying to sell you their real estate investment program. The danger is that many times these gurus don’t focus on one single technique. You could basically become a “jack of all trades and a master of none” so to speak. While it is a good idea to have a plan B. It is primarily important to find a niche, practice it until you have mastered it, and then repeat it. Become an expert in one strategy and stay focused on that model.
Don’t fall into the analysis paralysis trap. As any good real estate investor knows, it’s important to conduct thorough research on a commercial building before making an investment. The key is to avoid getting stuck in this step of the process. And spending too much time thinking about and analyzing the numbers, particularly the estimated future value of a property, you run the risk of losing the deal. Pay attention to current market values so you don’t waste time on unnecessary analysis; don’t purchase something for what might be. If the numbers work move forward, if the numbers don’t work, move on, unlike residential real estate where there is very little inventory in the Phoenix-area, we still have a good supply of commercial buildings available. And of course you want to be sure and allow enough time once you have found a property that meets your investment criteria to preform all the recommended due diligence associated with the purchase of a commercial building.
Don’t over extend yourself, don’t allow yourself to carry more debt than your investments can sustain. Make sure you maintain a cash flow at all times; and don’t tie everything up in financing, or you may have a difficult time surviving the market when it goes through a downward cycle. There are plenty of investors who have learned this lesson the hard way and are now bankrupt as a result of the latest crash in the commercial real estate industry.
Don’t buy emotionally, this is business. A big mistake a lot of people make when it comes to investing in a commercial building is that the most important thing to remember when considering a commercial building for investment, its all about the numbers !!
Unlike your buying a home for you to live in yourself, its not about the color of the carpet or even the condition of the carpet or how pretty the color of the building is, whether the building has garages or new maintenance free siding. The most important thing to remember when considering a commercial building is its all about the numbers !!
Join a local real estate investor group of club. Real estate investors feel a strong alliance to one another. Don’t be afraid to ask for help if you are new to the world of investing.
This information is for informational purpose and not intended to be investment advise, and should be explained to you in detail. You should always feel free to consult an attorney and/or tax adviser to obtain further information you deem necessary. I want you to be prepared