{"id":9830,"date":"2022-06-24T17:54:57","date_gmt":"2022-06-24T22:54:57","guid":{"rendered":"http:\/\/blog.jlbn.net\/?p=9830"},"modified":"2022-06-25T14:31:12","modified_gmt":"2022-06-25T19:31:12","slug":"real-estate-investing-for-beginners-free-download","status":"publish","type":"post","link":"http:\/\/blog.jlbn.net\/?p=9830","title":{"rendered":"Real Estate Investing For Beginners + FREE Download"},"content":{"rendered":"\n

Are you looking for a guide for real estate investing for beginners? CONGRATS! <\/em><\/strong>You have taken your first steps in your investing career!<\/p>\n\n\n\n

Before my wife and I got married, we each owned a house. After we got married, we didn\u2019t think we could sell one of our houses. So, we rented out my house.<\/p>\n\n\n\n

Before we continue, I want to say that at this time, I knew nothing <\/em><\/strong>about being a landlord and nothing close to real estate investing. If only I knew what I know now, I would have already been a millionaire!<\/p>\n\n\n\n

There is a saying, \u201cDon\u2019t reinvent the wheel.<\/em>\u201d A new investor doesn\u2019t have to repeat the same mistakes. A new investor can quickly catapult themselves to success by learning from the experiences (good and bad) of other investors. <\/p>\n\n\n\n

Although you may not be actively acquiring <\/em><\/strong>a property, you can be actively participating!<\/em><\/strong> Like a pencil, you can continually sharpen your knowledge, network, and skills!<\/p>\n\n\n\n

The Mindset<\/h2>\n\n\n\n

About ten years ago, my wife said she wanted to buy a condo downtown and rent it out. I quickly disagreed <\/em><\/strong>and told her that I did not want to fix the toilets<\/em>. <\/p>\n\n\n\n

With the first real estate property I described earlier, I would feel disappointed <\/em>that I would only cashflow only $100. I also frequently worried if the tenants were going to destroy my house.<\/p>\n\n\n\n

I did not understand real estate back then. All I focused on were the potential problems. All I cared about was profit from the monthly rent.<\/p>\n\n\n\n

I didn\u2019t have an investor mindset. <\/em><\/strong><\/p>\n\n\n\n

According to The Millionaire Real Estate Investor By Gary Keller<\/em><\/strong>, there are four different investing attitudes: observing, speculating, collecting, and investing.<\/p>\n\n\n\n

At that time, I was just an observer<\/em>. An observer wants <\/em>to invest, but because of fear<\/em>, they buy nothing.<\/p>\n\n\n\n

On the other hand, an investor looks for opportunities, reduces financial risks, and takes action! <\/em><\/strong><\/p>\n\n\n\n

Beginner investors also need to understand that investing is not <\/em>a get rich scheme. Buy & Hold Investing, in particular, is building wealth<\/a> over the years! <\/p>\n\n\n\n

Imagine having all your properties paid off! The rental real estate income from multiple properties will passively <\/em><\/strong>provide your income, your retirement, and cover expenses!<\/p>\n\n\n\n

Ways To Invest In Real Estate<\/h2>\n\n\n\n

There are many real estate strategies. Do you want to be an active investor or a passive real estate<\/em>investor? Do you want to be hands-on<\/em> or hands-off<\/em>?<\/p>\n\n\n\n

Real Estate Investment Trust (REIT)<\/h3>\n\n\n\n

A REIT <\/a><\/strong>is a company that owns, operates, and purchase various income-generating properties. These types of properties include, but are not limited to, apartment buildings, office spaces, hotels, medical facilities, and the like. Services, like Concreit<\/a>, make it easy to invest in real estate.<\/p>\n\n\n\n

Publicly traded REITs pool together the money of numerous investors to operate and acquire properties. Investors receive a share<\/em><\/strong> of the income produced by properties owned by the REIT.<\/p>\n\n\n\n

However, a REIT is not the same thing as real estate syndication<\/a>. Although syndication pools together money of multiple investors, the investment focuses on only one investment property.<\/p>\n\n\n\n

This way of investing is purely passive<\/em>. It avoids <\/em><\/strong>the work of searching for properties, handling construction and repairs, and managing tenants.<\/p>\n\n\n\n

The usual minimum for a person to start investing in a REIT ranges from $1,000 to $20,000. <\/p>\n\n\n\n

However, this type of real estate investing<\/a> does not allow investors to benefit from their property\u2019s appreciation because they do not own property. <\/p>\n\n\n\n

House Flipping<\/h3>\n\n\n\n

House flipping<\/a> is a good option for an investor looking to profit in a relatively short amount of time<\/strong>. This investor needs to be an active<\/em> investor.<\/p>\n\n\n\n

Flipping<\/a> is when an investor acquires a property, makes improvements, and sell it for a profit.<\/p>\n\n\n\n

Notice how flipping is different buy & hold investing. Buy & Hold investing in building long term wealth. In contrast, flipping can supplement or even replace ordinary income.<\/p>\n\n\n\n

The key to successful flipping is to purchase a very <\/em><\/strong>undervalued property<\/a>, which is usually a foreclosure<\/em>. This strategy allows for larger margins of profit when selling the improved property.<\/p>\n\n\n\n

The difficulty is the supply <\/em><\/strong>for undervalued properties are low<\/em><\/strong>.<\/p>\n\n\n\n

However, the good thing about low supply<\/em> in the market is that owner-occupied home buyers are willing to pay top dollar<\/em> for a property. This low supply allows a flipper to list their property for a dollar amount, ultimately increasing their profits!<\/p>\n\n\n\n

Interested investors should note that if a flipper sells their property less than a year<\/em>, then the profit is considered ordinary income and will be taxed as short-term capital gains<\/em>. In contrast, a property taxed on long-term gains receives a better taxable bracket.<\/p>\n\n\n\n

Buy & Hold<\/h3>\n\n\n\n

Buy & Investing is when an investor becomes a landlord to tenants<\/a>. The tenants pay down the debt and additional expenses associated with the property over time.<\/p>\n\n\n\n

The cashflow <\/em>produced by these investment properties depends on the monthly expenses. The monthly expenses consist of mortgage, taxes, insurance, repairs, etc. The higher the monthly expenses, the lower the monthly cash flow from the rent.<\/p>\n\n\n\n

This type of investing can be active <\/em><\/strong>depending on how much improvements are necessary along with managing tenants. <\/p>\n\n\n\n

However, it can be passive <\/strong>if an investor buys a turnkey or a rent-ready investment property<\/a>. The investor can also hire a property manager to market the property and manage the tenants.<\/p>\n\n\n\n

Because the investor owns the property, the investor can also benefit from its real estate appreciation. The appreciation of the properties will add to the net worth of the investor. Owning your property is different from being part of a timeshare, which is why some people are trying to get out of a timeshare<\/a>.<\/p>\n\n\n\n

Furthermore, the monthly expenses of rental property investing are tax deductions<\/a> lowering the investor\u2019s taxable income.<\/p>\n\n\n\n

They have multiple properties that cashflow can replace or supplement an investor\u2019s ordinal income. On the other hand, investors can use this type of investment for retirement<\/em><\/strong>.<\/p>\n\n\n\n

Compare a retirement account<\/em> in the stock market versus the income produced by a rental property. <\/p>\n\n\n\n

The amount a person can withdraw from their retirement account in stocks or mutual funds depends on how much they could save up. The draw usually will not match their pre-retirement income.<\/p>\n\n\n\n

On the other hand, the cash flow from a rental property will remain stable <\/em>or increase <\/em>over time.<\/p>\n\n\n\n

Land<\/h3>\n\n\n\n

An investor can buy land<\/a> and hold onto it until they can sell it for a profit. Another strategy for land investing is an investor can do seller financing<\/em> with a buyer. This type of investing is also passive<\/em>.<\/p>\n\n\n\n

Seller financing is when the seller acts as a lender. <\/em><\/strong>The buyer pays a down payment and makes monthly payments to the landowner until paying down the agreed-upon amount.<\/p>\n\n\n\n

The difficulty of land investing<\/a> is coming up with comparable values to determine market value. Also, unlike Buy & Hold Investing, land investing does not<\/em> cash flow.<\/p>\n\n\n\n

Note Investing<\/h3>\n\n\n\n

A note is a promissory note<\/em> that contains the terms of a loan, such as a loan amount, interest rate, length of the loan, payment amount, etc. Usually, investors are buying real estate properties through a lender<\/a> who creates a note with the borrower.<\/p>\n\n\n\n

A note investor acquires the ownership<\/em><\/strong> of the note at a fraction of the principal balance. Afterward, the borrower\u2019s payments transfer to the new owner of the note (i.e., the investor).<\/p>\n\n\n\n

As a REIT, this type of investing is also passive<\/em>. There are no maintenance expenses or tenants to manage. <\/p>\n\n\n\n

However, because a REIT pools together other investors\u2019 money, there is a lower entry barrier. A note investor may require more upfront money<\/em><\/strong> depending on the remaining principal of a loan.<\/p>\n\n\n\n

Real estate Crowdfunding<\/h3>\n\n\n\n

There are real estate apps<\/a> and crowdfunding platforms, such as Fundrise<\/a><\/strong>, that can allow anyone to get involved in real estate. This kind of investing is passive.<\/p>\n\n\n\n

However, there is no guarantee on your return because you don\u2019t know all the details of the property you are funding. <\/p>\n\n\n\n

Recommend Books<\/h2>\n\n\n\n

Whether you\u2019re looking for your first real estate deal<\/a> or your fifth deal, you can always stay active by educating yourself through reading. Here are the real estate related books I recommend for getting started in real estate investing.<\/p>\n\n\n\n

Rich Dad Poor Dad By Robert T. Kiyosaki<\/h3>\n\n\n\n

Rich Dad Poor Dad<\/em><\/strong> was the <\/em>book that changed the way I understood money and wealth. The author emphasizes having more assets than liabilities. Assets generate income, whereas liabilities are debt that causes someone to lose money.<\/p>\n\n\n\n

The Millionaire Real Estate Investor By Gary Keller<\/h3>\n\n\n\n

The Millionaire Real Estate Investor is an inspiring book that has identified multiple common models used to create real-life millionaire real estate investor. These are the models:<\/p>\n\n\n\n