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I’ve always believed in learning from the best. In a real estate investment career that has seen me rise from the bottom of the ladder and end up with millions in the bank and more than 7,000 apartment units in my name across more than six states. I made mistakes, and learned from them, but I also made sure that I learned from those who were ahead of me and were successful.
As you’d expect I get asked for a lot of advice and many questions about the best way to succeed in real estate investing and in many cases I point those who ask to my workshops and courses which are designed to help new real estate investors gain the insights and experience-based information I would have loved to have had when I was starting my career. But I also give advice and insights away free because I too, valued such information when I was learning.
This brings me, rather neatly, to this piece. I am often asked what’s the best way to invest in real estate and my response is that there is no ‘best’ way as such. Each investment decision you make depends upon the circumstances you are in as an investor, what the market is doing and the level of risk you are comfortable with.
It is risk, or rather risk management, that for me is the deciding characteristic of a good real estate investment decision. Let me explain. Let’s say you go for a single-family dwelling. The moment you take it on, if you hold on to it, instead of flipping it fast for a profit, you have began to build a long-term, steady income stream that will keep on delivering good value to you for years to come.
At this point most real estate investors, quite rightly, also think of the drawbacks involved. Tenants moving, the property remaining empty for a couple of months, damage to the building and its fittings which has to be set right and the general cost involved in running it and overseeing it.
The smart money, of course, lies in perspective. Rather than see the problems of one such building multiplied a few fold the moment you switch and go for multiple-family dwellings, it pays to think that what you are doing, in this case, is spreading the risk of the negatives while multiplying the income streams available to you, all from one real estate investment decision.
The truth is that managing multiple-family dwellings is no more trouble than managing a single one plus, because you now have volume, you can achieve economies of scale, outsource the day-to-day running and management very cost effectively and never have to deal personally with a single tenant, ever!
This way of thinking and risk management is the secret to successful real estate investment and it is how you can make a fortune through clever investing.
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