AVOIDING RISKS IN REAL ESTATE

Many novice investors in real estate ask questions steeped in greed, instead of gaining the education needed for long-term success. 

Greed is a roadmap to failure, and this is why Glenn Schworn teaches the importance of  Avoiding Risks in Real Estate.

Questions that raise red flags are typically centered on instant gains.

  • How can I maximize my investment dollars in the next three months?
  • How long will it take me to contract a house and sell it for profit?
  • Where’s the best location to do a quick turnkey deal?
  • While people engage in real estate to make money, these questions are short-sighted. They all have a common thread – a short-term outlook.

    Short-term real estate investing has its place, and it tends to work well in times of abundant buyers. However, when markets shift as they are now, a short-term outlook will disappoint.

    There are known occasions when short-sighted strategies lead to bankruptcy for novice investors.

    LEARN TO FOCUS ON APPRECIATION

    The process of real estate appreciation is seldom used amongst novice investors. Simply put, appreciation is the increase in value of property over time. These properties can include:

  • Single-family house
  • Duplex
  • Quad-plex apartment building
  • Eight-plex apartment building
  • Land
  • When a market becomes hot, meaning that people place high demand and desire to live there, prices increase regularly, and sometimes rapidly.

    Appreciation is the difference between the value of the property at purchase and the value upon resale. Ideally, investors like to purchase properties that will appreciate – this is an easier way to make money.

    When markets become hot investors tend to pour in and reap appreciation benefits – this is trendy but not sustainable.

    Investing with a short-term outlook is risky because investors do what they want instead of what’s needed—short-term outlook investing results in economic catastrophe. 

    Conversely, committed real estate investors know they must do the necessary work to maximize profit by providing a quality product.

    IMPROVEMENT IS A SOLID FOUNDATION

    Committed real estate investors evaluate a property before purchasing it. This evaluation may include:

  • A complete property inspection
  • Drafting of a comprehensive scope of work
  • Acquiring 3 contractor estimates
  • Market analysis
  • Why do real estate investors do such detailed work before purchasing a property? Experienced real estate investors play the long game.  

    The long game is a cliché that places emphasis on individuals that have far-sighted vision and long-term strategies that enable investors to thrive in the real estate industry.  

    Experienced real estate investors are not seasonal, they do not only engage in investing during hot markets. Quite the opposite is true. Committed real estate investors study the market and profit regardless of the macroeconomic condition.  

    In short, committed real estate investors are in it to win it. They have a long-term outlook which prepares them to remain consistent during turbulent times.

    Appreciation is the cherry atop a hot fudge sundae for the committed real estate investor – its improvement guarantees their profit margin.

    Real estate investors seeking to improve properties reap benefits in any market condition.  

    Currently, markets are cooling and the short-term focused investors are fleeing. Meanwhile, serious investors are delighted. They recognize this as an improvement market where houses are renovated, but not immediately sold.

    HOLDING YOUR REAL ESTATE TO AVOID THE RISK

    Glenn Schworm, the co-founder of Home Flipping Workshop, highlights many helpful nuggets in his video, Avoiding Risks in Real Estate. He focuses on the benefits of building a portfolio.

    That’s right. The savvy, committed investor is taking advantage of available inventory with few buyers in the market. 

    It’s time to buy low and hold – this process is called portfolio development and management.

    Think about it: if consumers aren’t buying, then what are they doing? They are renting.  If you do real estate investing wisely, they will rent from you.

    Play the long game and leave the short-sighted stuff to the uncommitted novice headed toward bankruptcy while trying to make a quick buck.

    WHAT’S NEXT?

    The ideal question is: how best do I develop as a real estate investor? There are many ways to engage in this growing industry, but we have a simple solution. 

    Meet Glenn and Amber Schworm at the upcoming Home Flipping Workshop. They will help you develop and grow as a serious-minded investor.  

    You will learn how to adapt to shifting market conditions and remain profitable.

    Make the decision today to learn the real estate investment business thoroughly and avoid being a trendy investor who flees changing markets.

    Now is the best time to learn what you’ll need to succeed in real estate investing by registering for the next 3-day course at www.HomeFlippingWorkshop.com.