investing in real estate

Real estate investing provides literally no end of opportunities and investors have their own priorities. Those that invest in commercial properties, multi-million dollar apartment projects or even mega-retail centers have the experience and expertise in evaluating a potential project.

Such properties can command millions of dollars and just the slightest misjudgment can turn a profitable opportunity into an albatross. On the other hand, a private investor can buy a $100,000 property, a type of property that the investor truly understands: single family homes.

That’s one of the keys to successful real estate investments; knowing exactly what you’re buying. Commercial investors are in the business because they’re extremely knowledgeable about their portfolio. You, too, should take the time to get to you know your expertise as well.

Most investors start out small. Some move on to bigger projects while others simply decide that they know a good thing when they see it and continuously search for and buy properties they’re familiar with.

Instead of searching for potential projects based upon a buy price, successful investors become experts in a particular development or neighborhood. There’s an inherent knowledge, built upon hands-on activity in a specific geographic area, which allows an investor to quickly identify and evaluate a prospective investment.

Think about that for a moment. It makes complete sense. If you’re constantly working an area with say 500 or 600 homes, you know what’s selling and what’s sitting. If you see a vacant property or one that is in disrepair, you get an immediate idea on whether or not to pursue the possibility.

Investors who spend their time searching across the entire city, suburbs and even other metropolitan areas, spend too much time looking and too little time investing. By concentrating on a particular area and becoming the neighborhood “expert” you’ll soon find that deals will come to you. Residents who live in the area and real estate agents who claim the neighborhood as their farm will soon recognize you and can be your own lead source 24/7.

Knowing the neighborhood inside and out makes your evaluation process much more efficient and your investments more profitable.