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Regardless of what kind of real estate you choose to invest in, timely collections from your tenants is absolutely necessary. A positive cash flow -- whether it is pre-tax or after-tax -- requires rental income. Be sure to find quality tenants; a thorough credit and employment check is probably a good idea.
One of most important factors in determining a solid investment is amount of equity you are purchasing. Equity is difference between actual worth of property and balanced owed on mortgage.
Benefit from Growing Equity
While investing in real estate is relatively complex, it is often worth extra work. When compared to other financial investments, like bonds or CD's, return on investment for real estate purchases can often be greater.
The key to real estate investing is equity. Determine an amount of equity that you want to achieve. When you reach your goal, it's time to sell or refinance. Determining proper amount of equity may require assistance of a real estate professional.
(c) Copyright 2005 Madan Ahluwalia. All rights reserved.
Madan “Raja” Ahluwalia is an Attorney at Law & Realtor. Raja offers his clients a counseling-based approach to home buying, where the client’s long-term goals are the most important consideration. He possesses a thorough understanding of the market and trends, based on years of involvement in real estate. He provides expert insights and helps clients understand timing, pricing and financing issues. Contact Raja at email@example.com or 650.430.4023.