Curious about how to become a real estate investor and invest in real estate? You aren’t the only one! Real estate investments have outperformed the Standard & Poor, or S&P, 500 stock market over the past 20 years. The S&P has averaged a rate of return of 8.6% during this time period. But residential real estate has averaged, nationwide, a 10.6% return. And some areas have done substantially better than that.
Like any investment, real estate can be a cyclical investment. And it’s critical that you know what you are doing before diving head first into investing in your first property. So how can you get the knowledge that you need to be a success in real estate?
Know What You Don’t Know to Invest in Real Estate
Sometimes it can be hard to admit that you don’t know something. And real estate is a topic with so many layers, that it’s impossible to realize all of what you need to know at the outset. But there are steps that you can take to make sure that you know the fundamentals and have sources that can help you fill in any gaps as you move forward.
You can start by joining and getting involved in some real estate clubs and groups. These are great places to start to make contacts and learn from others what is working as well as learn what isn’t working in your area.
Many areas have local real estate clubs where you can connect with individuals in your specific area. For options in Texas, you might want to check out some of these opportunities listed HERE.
In addition, there are national groups as well that meet locally and offer memberships. Many of these groups have courses or training that you can explore as well to further develop your skills in real estate. One of the more popular organizations to check out is the National Real Estate Investors Association.
And don’t forget online options! You can find several forums and online groups to explore and see which ones are a fit for you and your goals. Facebook is probably one of the best sources for online communities and groups for real estate investors. Look for ones that are active and where the community looks to be supportive of their members.
Pick Up a Book or Course
Everyone learns differently. The key is to learn and learn in a style that’s best for you. These days there is a ton of excellent and helpful information online that can help you learn the fundamentals of real estate as well as the terms and concepts that go into real estate investing. These are critical and will make it easier to talk with others in the field.
A quick search online will show you several options to consider. The key is to make sure to choose one that is being taught or written by someone that is well reviewed and has substantial experience.
Some options to consider would be online courses from sites like Udemy.com or RichDadEducation.com. The National Association of Real Estate Investors (mentioned above) also offers courses and guides to those just getting started as well as those with experience that are looking to learn more.
In addition to courses, there are a mountain of real estate investing books to explore. Just make sure to check out the author and their experience and reviews before buying.
One of the best ways to learn just about anything is by having a mentor. If you haven’t had a mentor before, this might be the perfect time to explore the concept. A mentor is someone that is experienced and knowledgeable in a subject area. They are also someone that is willing to help you out as you learn the ropes and develop your own skills and expertise in the topic, in this case, real estate.
As you join groups or real estate associations, be on the look out for someone that can mentor you. In fact, look for a couple of people that might have expertise in various areas where you want to increase your skills.
Get to know them, learn about them and their backgrounds. Also look for ways that you can assist them and help them. It may be in real estate, it might not. But by helping them, you’ve made it easier for them to say yes to helping you.
Real estate covers so many fields, so here are a few ideas to consider when looking for a mentor:
- Look for a mentor that has expertise in renovations and rehabbing properties. That can help you learn what to look for, what to avoid and what a property will cost to fix up.
- Look for a mentor that is a pro at finding and analyzing deals. Learn how to find properties and estimating the costs is critical to how well you will succeed.
- Find a mentor that knows the financing aspects of real estate. Having someone you trust to help you get the best financing for your properties is key.
- Mentors that know how to sell a house for top dollar and what you need to do to make that happen can be a huge boost to your bottom line.
You might get lucky and find someone that can do all or most of these. Or you might have a few people, each experts in one area.
Learning How to Invest in Real Estate is a Long Term Process
Unlike some subjects, learning to invest in real estate can be a life long process. Neighborhoods change, markets fluctuate and financing options are always variable. In addition to that, your real estate goals and objective might change as well.
As long as you continue to learn and stay active by being part of the real estate community in your area or online, you’ll be able to flow with the changes as they occur. The most important step is the first step.