Are you a first-time investor looking to expand your portfolio? Click here for seven practical tips for expanding your property portfolio.
Keyword(s): full service property management, Seattle property manager
Did you know that as of June 2022, the average salary of a real estate investor in America is $119,731 a year? That works out to about $9,978 a month.
Doesn’t this sound pretty enticing? Well, as a first-time investor, you can get here as well! All you need is the right attitude, persistence, and the help of full-service property management.
You also need to expand your property portfolio bit by bit over time. Read on for some tips that should help.
1. Actively Find Cash-flow Positive Properties
What happens with a lot of first-time or newbie investors is that they fall in love with a property and hanker after it, even though the property isn’t cash-flow positive or appropriate for their property portfolio.
Don’t let this happen to you! Always work out the numbers first, before doing anything else. If the numbers don’t make sense for you as a property investor, then step away and find something else.
There will always be other properties around the corner, so don’t get enamored with one property and waste all your time on a useless venture. Every property should bring in positive cash flow. That should be your cardinal rule of real estate investing.
2. Find a Full-Service Property Management to Assist You
There are many individuals you will want to have on your team as a real estate investor. This is even more true if you are working full-time and don’t have time to take care of your properties by yourself.
But remember that you don’t need to build your entire team from the get-go. You could start by hiring a full-service property management team and they can take care of your entire property portfolio as you build it up. This way you don’t have to wake up in the middle of the night to deal with cranky tenants or fix broken toilets.
Someone else can take care of all the headaches, while you build up your property portfolio and enjoy the cash flow benefits. A Seattle property manager will make your life so easy that you will wonder why you ever thought of doing it all on your own.
3. Don’t Forget To Reduce Costs Whenever You Can
When you are first starting, you won’t be able to gauge accurately what you should be spending money on freely and what you should skimp or save on. That’s okay. You will learn this important skill over time.
But make sure that you always leave some give in your monthly cash flow and don’t spend it all in one place. Have an emergency fund in place for your business, so you can pull on that whenever there are any major emergencies.
And don’t forget to get landlord insurance for every property you own. It might seem like a useless additional expense, but it’s well worth it.
4. Spend Some Cash Every Year on Maintenance
You know how it’s recommended to spend 1-4% of your property value on maintenance every year. That’s for a homeowner, who’s going to take care of their properties like they were gold.
But you are dealing with rental properties and somehow tenants don’t extend the same care towards rental properties as they would towards their own. You might have to spend a bit more in maintenance every year on your properties because that would mean that you can charge extra in rent and get more cash flow that way.
It will also make it easier to rent out your properties when the time comes or sell them when you decide that you wish to get out of the business years down the line.
5. Go Slow and Steady - Don’t Overextend Yourself
The most important takeaway of this article is this - do not overextend yourself as a property investor. There is no timeline you have to follow and there’s no rush to become a real estate millionaire.
So take your time, and buy your properties with care and finesse. It’s possible that if you buy too many properties and the market dulls a bit or inflation hits, you could go bankrupt or insolvent. Don’t let that happen to you.
6. Don’t Get Overly Focused On Your Goal Post
It might be your lifelong dream to be a real estate investor, and that’s great. But don’t forget about living your day-to-day life and spending time with friends and family because you are too focused on reaching that milestone.
Build a work-life balance and ensure that you are taking care of your health and your sacred relationships so you don’t sacrifice the important stuff for a dream that you will reach in the future.
7. Consider Buying Homes for Cash
Buying homes for cash has become a huge business in America nowadays and there's a reason why. Lots of sellers are desperate to sell their homes fast and get on to their next thing. You can help such desperate sellers by giving them cash for their homes if you have the facility for such a purchase.
8. Buy Homes at Auctions
A lot of real estate investors have realized the potential of buying underpriced homes at auctions, fixing them up, and renting them out for a good profit. Make sure you don't fall in love with a property and don't overbid for properties that aren't worth that much. Ensure you make your profit already when you purchase, so everything else is just icing on the cake.
Becoming a Full-Time Property Investor Isn’t Easy
Building your property portfolio isn’t a walk in the park, so don’t let anyone tell you otherwise. It requires years of hard work, patience, and persistence.
But with full-service property management in your court, you can make it easier on yourself. Contact us today to see how we can help make your property owner's career blossom. We would like to help maintain, manage, and enhance your rental property.