One of the first characteristics of income property investing you should convey to your customers is that all properties are not created equal. Knowing and understanding the difference between single-family, multi-family, and commercial income property can be the difference between success and failure as an investor. And trust us, there is much success to be found through this type of real estate investing but there is also a resounding crash waiting for you if you don’t understand what you’re getting into before you pull the trigger on that first deal.
Welcome to part of our review of what we like to call the 10 Commandments of Successful Real Estate Investing. If you missed the first five, check the recent archives. Today we’re charging ahead with commandments #6 through #10. We believe the concepts here form the foundation of any investment portfolio, no matter the the asset, though we certainly have our preference – income properties.
You may recall our last blog, where we mentioned the 3rd Commandment of Successful Real Estate Investing, which is to “Maintain direct control of your investments,” and promised to revisit the topic in more depth later. Well, later is now. Direct control is a critical aspect to creating wealth. It’s a simple concept. Directly controlling your investments means you don’t rely on someone else to do the deal for you. Having a trusted financial adviser is a good, make that great, idea but he shouldn’t also be a broker getting a transaction fee for the deal.
There’s another book you might have heard of that begins with 10 commandments. While AIPIS agent certification doesn’t claim to have the absolute authority of God – if you happen to believe in the Bible – but we do have 10 fundamental truths that will serve you well going forward as either a real estate agent or income property investor. Let’s take the first five.
Real estate certificate courses that don’t teach you how to close sales in the real world are not especially helpful. Selling is a process and it shouldn’t be thought of as a dirty word. The stereotypical used car or time share salesman leaps to mind. This is not the model you want to pattern for long term success in the real estate business. It does no good to browbeat or trick a customer into buying a certain property and then suffer poor word-of-mouth for the next decade and never have a chance to sell to them again as a repeat customer.