Real Estate: An Opportunity to Profit or Fail?

Summary: Taking real estate property and flipping it into a gain can be a significantly difficult task. Fortunately, there are ways that you can do this without immediately going into bankruptcy.

The real estate market is a fantastic opportunity to bring in significant wealth. While it isn’t easy, due to a fair amount of competition, it can be worth it in the long run. Here are some tips that will guide you on the right track to successfully managing and investing in real estate.

Your Credit Report Plays a Major Role

You’re more than likely going to have to borrow a significant amount of money to purchase real estate. So, be sure to check your credit report before you begin investing in real estate. If you have problems on your report that are mistakes, get those resolved as quickly as you can. Any marks on your report are looked at by the lender and it may affect your chances of obtaining the loan. If you have problems that are legitimate, you may want to ease off on the investment for now and work on building your credit back up.

Simply put, banks aren’t going to lend you money for a property that isn’t your primary residence as easily as they will for your own home. This is why having a glimmering credit score is an important factor that’s often overlooked.

Implement the One Percent Rule

If you’re planning on buying property that will be for one or more tenants use the 1% rule which will decide whether or not the property is worth the asking price. Simply stated, the rule is that an income producing property must produce 1% of the price you pay for it every month. If you’re looking to buy a property for $300,000, then your monthly rental income should be the $300,000 multiplied by 1% which equals $3,000. This is a good rule of thumb for starters and it also assists in profit margins.


Bio: Omar Amanat is an American entrepreneur and a shareholder of the popular Twilight Saga.