Are you ready to invest?

Are you REALLY ready to invest?

Most of the self help real estate investment books out there make real estate investing look EASY. And to some degree they are right. It IS easy to buy real estate at a LITTLE bit off of retail. However, after the purchase is where things get sticky.

A REALTOR friend of mine, Anne Mayhugh and I were discussing this a couple of days ago. Most people who start into investing are SOMEWHAT prepared to buy. Most are NOT prepared to manage. Real estate ivesting is every bit as much about management as it is about buying. What do I mean? Here are some examples that they (usually) do not provide in the "everything you need to know " manuals:

You buy a property with the intention of flipping it and selling it quickly. The market softens a bit and you find that you have put too much fix up money into the place and didn't buy it quite as well as you thought...

Now you have an empty house with carrying costs (mortgage, taxes, etc.). So you go to plan B and rent it out for a little less than you'd like, but "at least it's covering the mortgage". Then the renters stop paying on time and the furnace blows up...YIKES/

My point in this is NOT to discourage real estate investment. It IS to add a dose of reality into realty. Stuff happens. (edited since this is a family friendly blog). Managing through those crises is CRUCIAL to making money in the near and long term.

Make no mistake, money can be made, but ONLY when risks are prepared for, understood and addressed quickly and efficintly. Trying to solve things is crsis mode is a near certain recipe for disaster.