Women Get Wealthy

1.  The Numbers Don’t Lie!

Regardless of how nice the neighborhood, how steep the discount or how attractive the property, if the numbers do not work, according to the PLAN, the deal is a NO-GO!  Determine, in advance, what it is that you are looking to achieve from any given investment.  Determine an acceptable rate of return and stick to it!  I recommend that you base your calculations on conservative numbers (round expenses up and round income down).

2.  Location, Location, Location!

We have heard it a million times and it still holds true today.  The location of your investment is a fundamental principle, when it comes to real estate investing.  Be sure that your area of choice is stable and, preferably, growing.  Economic growth, Population Growth, Desirability and Affordability are all key indicators of a good market.  People will not be likely to stay in a location where jobs are scarce, surroundings are poor and there is a shortage of affordable housing.

3.  Know Your Market

When it comes to Real Estate, you need to know the current values within your market.  You must know the true value of a property you are buying.  A determination should be based on hard evidence –  recent sales of similar properties in the area.  You should see these comparable sales for yourself and NOT base a decision on hearsay or someone else's opinion.  It is also critical that you know the common rent rates for your area.  Again – not based on someone else’s word but hard facts.  Drive the neighborhood and call on ‘For Rent’ signs.  Check the local newspaper for similar rental ads and go check out the competition.  Learn the condition of these homes.  Craigslist can also be a great source for information.  You may even want to post a dummy ad and see what type of response you get.

Bottom Line – setting and following Rules is critical to any successful business venture.  A decision to invest in real estate should be no different.  Set your rules FIRST and keep them in mind when considering any type of investment.  The goal is to have rules which will prevent you from making a decision based on EMOTION.