This is part 5 of 5 in a series on investing in real estate to achieve financial independence. This is actually being released ahead of part four because of our sitz im leben, our life setting. We are about two weeks into basic quarantine here at Spendlove Drive.
Can I seriously advocate for investing in real estate now?
I don’t tell people when to invest, but I am doing it myself presently. Whether you are educated enough to make a good decision now is something you can only determine. Yet, I can advocate for being ready. There will come a time when COVID-19 will pass – and those that are ready – will have the best opportunities. We may see a dip in real estate values in the Anchorage area – you’d expect that we would with both oil prices low and the current chaos. Yet – all markets function as a supply and demand equation. Prices will only go down if there are more sellers than buyers. I don’t plan to sell my assets.
Let’s go back to being ready. If you saw Starbucks stock take a hit down to $52 last week and bought it – you’re up to $70 today. But you had to have a trading account. You had to have some money in the account. You had to be poised to act, and ready for some risk. Our quotable friend Warren Buffet again, “Be greedy when others are fearful, and fearful when others are greedy.”
So – are you ready to invest in real estate? To purchase a home at a good price? Even if there is a 5% discount on a 4plex, you can save over $20,000. When was the last time you saved $20,000?
Have you heard the popular Chinese proverb: “The best time to plant a tree was 20 years ago. The second best time is now.” Basically in the context of the conversation here, this means that if you want success and growth in the future, the best time to act is now. You may want to wait a few weeks to purchase, but fortune does favor the bold.
In the spirit of being ready, below are three areas you can work now to position yourself for growth and success in the near future:
- Self-Educate – your mind is your greatest asset. Learning about investing is what you should be doing! Get a copy and read “Rich Dad Poor Dad,” read about Warren Buffett, get on BiggerPockets.com, read Peter Lynch… Ask for more recommendations, listen to podcasts (BiggerPockets, ChooseFI).
- Network – learn from others. Find someone who has done what you’d like to do – and ask them how. Find others that are on the same path as you and journey together. Learn from those around you! You may have to do this on Zoom or via e-mail for a while – but not forever!
- Build your team. For Real Estate investing – typically you want at least a good lender, a good agent, a good title company, and good repair contractors. You can be working on your ability to borrow funds now by talking to a good lender (happy to refer you to people, hit the contact me to inquire).
Let’s use an Alaskan analogy – wild game hunting.
- A good agent is like a hunting guide – and will help put you in a position to take down a great tasting animal. Investors agents know what you can hunt for too – and can point you towards good lenders.
- A good lender will help you know what you can go hunting for, can you do caribou, moose, ptarmigan? Can you use a 12 gauge, or a .223LR? You can purchase different properties based upon your life situation and cash on hand.
- A good title company helps make sure you are the only one who can claim that prize!
- And a good contractor can help you preserve the prize so none of it spoils.
It’s no fun going hunting without a loaded rifle. Take this time to prepare yourself so that when the time is right, you can pull the trigger. Investing always involves some risk – it’s a bet that the future will be good. I think our future remains bright here in Alaska – and I am buying a BRRRR style duplex this week. I could back out – call it off amidst the chaos. But I think five years from now I’ll be so glad I didn’t. In fact – I think six months from now I’ll be so glad I moved forward.
Links for the other articles:
- How Real Estate Investing (REI) pays you in the short term (the What, and Who is this for?)
- How Real Estate Investing pays you in the long term (for me, this is a major part of the Why REI Investing?)
- The 101 of running the business (financing, property management, financial management). (…the How do I do this?)
- Ways to grow or leverage your business (and Where do I start?)
- But, “When do I act?” Your best next step… depending on where you are at
We will keep you updated