Real estate investing is an asset class worth adding to your investment portfolio due to the diversification, tax, and cash flow benefits that come with it. This type of investment offers steady income, long-term financial security, real estate appreciation, hedge against inflation, ability to influence performance, and yield enhancement. However, becoming a strategic and wise investor who scales a portfolio necessitates a little more legwork, especially if you’re looking to get the most out of your returns. Here’s a checklist for real estate investing in Arizona.
Getting pre-approved is an excellent move if you’re serious about purchasing your first investment property. Pre-approval gives you a clear idea of what you can and cannot afford. Get in touch with a local lender to find out what the top end of your price range is. It’s also important to discuss with your lender the type of real estate loan that would work best for you. You can get pre-approved by a traditional lender or a private lender like ourselves.
Learn Some Industry Jargon
Like many first-time real estate investors, you’ve probably been checking out articles on websites and browsing forums that deal with real estate investments. What may seem like a lot of endless acronyms and industry jargon such as leverage, amortization, Cap Ex, 1031s, NOI, REI, REITs, and LTV will become familiar in due course. Learn about the real estate investing terminology that investors use and why it matters. With this, you’ll be more confident and in a position to make informed decisions.
Look Beyond Curb Appeal
One of most common mistakes that first-time real estate investors make is judging a property based on curb appeal. While it’s natural to develop an opinion based on personal bias, keep in mind that the place you buy doesn’t have to be in a place you’d live. Instead, consider if the property you’re about to purchase is desirable for some set of tenants. Becoming a successful real estate investor is not about personal preference; it’s about whether the property will bring in the anticipated returns.
Focus On the Area
The location of the property is a critical aspect that you shouldn’t overlook. Ask yourself some strategic questions like is the city growing? What about the neighborhood? Is the economy diversified? What kind of nearby amenities are there and how are the schools? Do your homework and conduct a detailed market research. This should help you identify the best places to buy in Arizona and be in a position to forecast demand in the future.
Capital Fund 1 makes real estate financing as seamless as can be. We’re hard money lenders dedicated to helping investors avoid lots of the hassle, calls, and travels that come with conventional financing in Arizona. Contact us for financing help.