How I Got Started Investing in Real Estate

So you’ve been thinking that this is a good time to invest in income property, but you don’t know where to start. I felt that way once, so I bought the only multi-family building I could afford … $26,000! The neighborhood was a little iffy, so my visits were always in broad daylight, and I walked fast to and from my car. But I instinctively knew how to get and keep good tenants, as I had been one for several years. I sold the property just 18 months later, for $52,000 after investing $5,000 in a new roof, and $2,100 in repairs and cosmetic upgrades. These are my main rules:

1.    Care about your tenants … fix every problem promptly and communicate your progress.

2.    Keep the relationship businesslike and nicely and firmly enforce the terms of the lease. If you allow them to be late with the rent and don’t charge the late fee, guess what … they’ll be late again the next month. Just like kids, they need consistency in the relationship.

3.    Take a 12 month lease (or longer) and require 45 days notice to renew at the end. If you live in a 4-season climate like I do, never let a lease expire in December, January, or February. The last thing you need is an empty house or apartment and huge heating bills! Or worse – frozen pipes.

A few years ago I helped a local businesswoman buy her first rental house. It was cute, in a quiet neighborhood in Bartlett (low taxes), and had lots of potential with just some cosmetic improvements. She threw some paint and landscaping at it, and has kept it rented ever since. I think it was her success with this real estate investment that gave her the confidence to buy a commercial building last year, and expand her business. But you have to start somewhere.

Yes – I gave her the tools … my awesome lease form, tried and true rental application form, tenant checklist, and vendor recommendation for credit checks. But the sweat equity was hers. She has been referring clients to me ever since. “I thank Joy for taking the extra time and consideration to help launch me into real estate investing.” Michelle, it was my pleasure.

In October last year, I bought a darling rental house, with seller financing at 5%, and a more than 4.5% return in the first year. I love real estate!

Joy

P.S. Click the house to see a great rental income property in Conway NH!

This entry was posted on Wednesday, March 25th, 2009 at 11:10 am and is filed under NH Investment Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.