HOW TO ELIMINATE RISK IN RESORT
REAL ESTATE INVESTMENT!
AVOID 10 COMMON MISTAKES MADE BY INVESTORS

Real estate investment has provided many investors with cash flow, tax benefits and the satisfaction of making an impact in other’s lives.  However, like any investment, real estate has intricate nuances and market trends which, when ignored, can cause an investor tremendous heartache.

Unbelievably, many first-time investors are willing to part with their hard-earned cash without taking the time to study their investment.  They rely on traditional trends and gut feelings.  Before you risk your investment take the time to learn all you can about your market.  By aligning yourself with the right professional you can avoid these 10 common mistakes and you’ll ensure an excellent return on your investment.

1. Failure to Determine Your Time Frame-Cash flow, capital appreciation, tax benefits, loss of management, equity pay down and pride of ownership are just some of the things that need to be addressed before you make that investment.  A service minded real estate professional can be a tremendous asset by taking the time to evaluate your needs and making sure you’ve got all your bases covered.

2. Failure to Check Out the Seller’s or Seller’s Agent’s Numbers- Claims of extremely high rates of return run rampant in real estate investment. Don’t get caught up in the excitement-check everything:  rents, payment history, taxes, expenses, deposits, future modifications…everything.  Make sure you have the right agent… it’s like having a good insurance policy against overlooking all the seemingly insignificant but very important details.

3. Forgetting You are Buying a Business-Owning investment property carries with it great potential for creating wealth and some potentially difficult decisions…evictions, re-investment into the property, time management all need careful consideration.  Remember this is not a “hands off” business.

4. Avoid Negative Cash Flow-Property that eats cash every month can drain your working capital.  This creates stress and frustration that can become quite painful.  Predicting constant appreciation is extremely difficult if not impossible for the unseasoned investor.  A strain on your cash flow may cause you to sell the investment before the benefits of ownership are ever realized.

5. Utilize your team by aligning yourself with the right real estate professional. Top real estate professionals know lenders, title companies, and inspection teams…an entire group of professional making the whole buying experience simple and easy for you. This will allow you to have an entire team working for you.

6. Get the Best Property Management Company-This can add significantly to your rental income on a yearly basis.  I can recommend 3 different managers to speak with before you make a choice

7. Inspect, approve and confirm all documents- This list of documents that need to be proofed can be overwhelming to the investor.  Building permits, zoning laws, rental and lease applications, health licenses, laundry leases, underlying loan documents, by-laws, title policies, mineral leases, inspection reports, purchase contracts, insurance…don’t attempt to do it alone.  The right professional can remove most of the stress and bring the transaction to conclusion smoothly.

8. Get a Bill of Sale For All Property Involved-Many types of personal property (appliances, furniture, fixtures, etc.) can be involved in an investment sale.  Be very detailed…know who owns what and how much it cost.

9. Plan for Flexibility-Closing dates are not written in stone.  Allow for contingencies and have a back-up plan.  If you need a little more time to conclude final arrangements don’t let these delays upset or frustrate you.  These types of things are not uncommon in real estate transactions.

10. Don’t Spend Positive Cash Flow-Many successful investors have free and clear properties.  Be sure to re-invest your cash flow back into the property payment and speed up the amortization schedule.  This decreases your debt load and increases your equity and reduces your tax benefits, which builds your net worth.

Investment property can be one of the most rewarding components of your financial portfolio.  Be certain to have all your “ducks in a row” before you invest.  Do your homework!  Consult with a professional real estate agent and relieve yourself of the hidden troubles that can plague first-time as well as seasoned investors.

Hopefully this report has been of value to you.  It is our ultimate desire to help you achieve our real estate investment goals and provide you with the most professional, efficient and effective service!

Chuck can be contacted at (866) 409-8058. Put Chuck’s Knowledge and Professionalism to work for you!

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