There is no doubt about the fact that real estate is one of the most lucrative industries in the world, at least according to statistics. According to statistics, this industry offers an average return on investment(ROI) of about 10.05% per annum. Of course, the figures depend on the type of property investment in question. For instance, residential rental properties have an average ROI of 10.6% while commercial rental properties have an average return on investment of 9.5%. That means if you put in about $100,000 in the business, you can expect to make around $10,000 in profits, on average, at the end of the year, assuming all factors remain constant. Sounds like a good business to start right? Well, that’s accurate because it is!

However, no matter how promising real estate business may sound to the effect of wealth creation, it should be noted that this sort of investment can prove to be painfully catastrophic, especially if entered without a proper strategy. A number of factors, including, economic conditions, a change in demographics, geographic location, and supply of property, can cause your hard-earned money to go down the drain. To learn how to cushion yourself against potential real estate investment losses and to be sure to grow your business, here are some invaluable tips you should know:

Tips To Best Grow Wealth In the Real Estate Industry

1. Only Consider Good Locations

When you start shopping for a land where you will build your residential units, you will find plenty of options that are going for a wide range of prices. When you decide to look for ready-built units, instead, still, you will come across numerous options available for an extensive array of prices.

Property price variations are normally caused by a number of factors, with one of the primary factors being location. For instance, properties that are located in prime areas such as those in or near urban/developed areas with better infrastructure and social amenities tend to cost more and vice versa. Why? because they have a high demand from tenants.

It’s a good idea to pick land or ready-built units that are located in a prime area. Even though you will pay more for such, the return on investment you will derive from this will definitely be higher, thanks to the higher demand coming from tenants. Avoid remote locations because of the lower rental prices homes built in such locations do attract.

2. Start with Residential Properties

As a starting investor in the real estate niche, you have two main investment options; residential properties or commercial properties. You might be torn between the two such that you are not able to decide which option to go for between the former and the latter. Well, experts recommend starting out with the residential option. That’s because residential properties carry lower risks than their commercial counterparts. The profits may be lower than commercial property profits, though, which isn’t a bad thing, taking into account the fact that your investment will be safer to build wealth.

3. Do Not be Afraid to Borrow Loans

Contrary to what you may have been told, borrowing is an essential part of the success journey. All the richest people you know, including Amazon’s Jeff Bezos, Microsoft’s Bill Gates and Facebook’s Mack Zuckerberg once borrowed money to boost their businesses. Some of these well-doing companies such as Microsoft, and Amazon are still not debt-free. That tells you a lot about the power of borrowing when it comes to shaping your financial future.

Try securing funds from creditors to put into your business. By the way, real estate investing requires higher capital not so many beginner investors have. Instead of launching mediocre projects simply because you are cash-strapped and debt-averse, change your attitude towards borrowing. After all, if you can’t give you can’t offer the best, you can’t expect to maximize your ROI and build wealth.

4. Consider Buying Dilapidated Units

Buying abandoned and dilapidated properties to rent can be another great idea to build wealth. Such properties are sold at throwaway prices and can be easily restored to their former glory with renovation. The good news is that, in some states, the governments provide stipends to encourage homeowners to renovate and restore their dilapidated properties. If you can acquire some units in good locations and renovate them, you can make some good money off of these properties, despite the fact that you invested very little amount of capital.

5. Play Your Part Well as a Landlord

Before you want to become a landlord, you should understand that this title comes with a huge responsibility and a myriad of obligations. According to the law, these duties and obligations broadly fall under three categories:

• The obligation to give the tenant possession of the building.
• The obligation and responsibility to provide a habitable condition for the tenant.
• The obligation to not interfere with the tenant’s use of the property as long as they utilizing the property accordingly.

Neglecting your duties and obligations as a landlord can result in serious lawsuits with your tenants, which could end up costing you a lot of money in the process. For example, in 2017, a UK landlord was fined heavily for changing the locks in order to vacate the tenant. Mr. Nathan Shipley was found guilty of violating one of his obligations as a landlord, which is to not interfere with the tenant’s occupation of the property and was compelled by the court to pay the plaintiff a sum of about $3600.

Three thousand six hundred dollars is thirty-six percent of the average return on investment on residential property. Assuming the landlord had made the bare minimum profit that year of $10,000,(which is the average return on investment of residential property), it means he lost 36 percent of it to just one tenant. If this investor could have been fined for similar violations against other tenants, he could have lost an overwhelming portion of his 2017’s return on investment.

Final Thoughts

Do not be fooled that there are any other secrets to become successful in real estate investing apart from the above. If you want to best grow wealth in the real estate industry as an investor, mind your location, start with residential units first, and do not be afraid to take loans to boost your business. In addition, think about investing in those promising, low-cost dilapidated units that abandoned in prime locations, and be sure to play your part well as a landlord to avoid costly penalties.

Just as it’s impossible to plan a trip without a destination, you can’t build a successful real estate business without setting clearly defined goals. Success does not happen by fluke. It takes proper planning, and they are markers that show us how far we have come or how far we still have to go. Here are a number of ways on how to set great goals for real estate.

Know Your Why

Despite you having the resources, knowledge and a reliable team in setting up your real estate career, you will have a hard time if you clearly don’t know your “why”. So, start by writing down the reasons for venturing into the business. The reasons may vary from one individual to the other, but undertaking this important step in successful goal setting ensures that you understand what you want to achieve.

Goal Settings

Be specific with what you want to accomplish. For example, you could say “I want to earn a million before I turn 40” instead of “I want to make a lot of money.” You are most likely to achieve your goals if they are real and clear. And don’t forget to write them down.

Wealth Definition

Make sure you understand what wealth means if you are focusing on gaining wealth. In this case, wealth does not always equate to money. The meaning varies and could mean either of these important areas:

• Physical
• Relational
• Financial
• Intellectual
• Spiritual

Will Power and Attentiveness

The first great step is to ensure that goals are identified and are written down. Commitment, discipline, and focus are key in crushing the set goals. It means that an individual ought to work when the job is no longer new and exciting as a start-up. It means that work needs to be done when an individual prefers to be doing something else.

Realization that life’s outcomes are the responsibility of an individual, creates an ideal situation for the person to see desired results. Bad things may occur.

Bouncing back from setbacks makes a true statement of a person’s character. It greatly identifies the difference between falling down and staying in that position.

Create a Business Plan

The success in real estate lies in the development of a business plan. It involves creating an overview of what needs to be accomplished, and the specific steps needed to make this possible. It is essential for the plan to contain mission statement, specific goals, a strategically plan for accomplishing the goals, and the timeline.

Additionally, goals need to be refined within the market. Refining these goals could include purchasing rentals, commercial buildings, or buying and holding. Also, specific criteria for deals to be undertaken ought to be clearly indicated in the business plan.

Listing the teams and systems that are already in place helps in efficiency. A back up plan or an exit plan is also important. All these steps are necessary for the success of real estate goals.

Find Your Niche

Finding and understanding a niche is important in real estate. It will help in weeding out the strategies and deals that are sub-optimal in meeting the goals and focusing on the optimal ones. It is critical to find out what a person likes, the strengths, and understanding the need in the market.

Understanding the market and carrying out an analysis adds more prospective to succeeding. Researching about the market and the industry at large is advantageous. Coupling this with having a game plan increases the chances of success.

Set SMART Goals

Every goal that is set needs to be SMART, that is, Specific, Measurable, Attainable, Realistic, and Time bound. Investors should revise their goals to ensure that they are SMART. The center of attention for the goals should gravitate on efforts that allow the effective use of resources as well as time.

Setting SMART goals in real estate helps in setting tangible numbers that can be easily tracked. It provides a concrete measure for deadlines all through.

Adopt Key Visual Tools

When setting your real estate goals, adopt different concepts such as the Wheel of Life. The visual tool helps in identifying the different areas in your venture that need immediate focus. For instance, if your area of focus is relational and the wheel is short, it means that you have not established helpful relationships with your friends and family.

This means that your life is not in the right direction, and such an imbalance is most likely to affect your life negatively. So, the wheel concept helps you come up with short-term goals by finding balance in all aspects of your life.

Short or Long Term Goals

Have both short and long-term goals to achieve your desires in the long run. The former refers to things you are willing to achieve in a short time, more specifically within six months from the time you set the goal. A few examples smart, personal short-term goals are:

• Cutting off or reducing unnecessary expenditure
• Offering volunteering services often
• Having an organized place of work
• Working out once or twice a week
• Waking up and sleeping early to ensure you have enough rest
• Maintaining a work discipline
• Saving

You can achieve these goals in a short time, which, in turn, will help meet your long-term goals such as earning more, reducing or eliminating debts, becoming more productive, and being fit.

Ask yourself honest questions like “Where do I want to be in 10 years?” or “Do I want to be in debt in five years?” to come up with long-term goals.

Conclusion

It is okay to start small in the adventure of investment in real estate. For instance, investing in rentals to get the general idea of the overall process might be a great idea. It eliminates the process of home acquisition, renovations, or getting tenants. Irrespective of the strategy used while investing in real estate, setting intentional goals is key. It ensures that the action steps are prioritized and the process moves towards attaining the short-term and long-term goals.

When buying an investment property, people typically go the traditional route and purchase from a brokerage and go through a real estate agent. Real estate agents use a Multiple List Service (MLS) to list houses that they have for sale. This is the traditional route to take when buying a house.. A second option however, is to buy from a wholesaler. If you’re looking to buy an investment property, buying from a wholesaler is a great way to find the best deal for you. Wholesaling is different from going through a traditional approach and can be confusing if you’re not familiar with the process. Here’s how anyone interested in purchasing from a wholesaler should approach the process.

What is a wholesaler?

Before you can buy from a wholesaler it’s important to know what wholesaling is and how it differs from the traditional home buying process. One major difference between a wholesaler and an investor is that one does not need a license to be a wholesaler, anyone can do it. Wholesalers also do not work for a broker like agents do. 

In simplest terms, a wholesaler finds great deals on homes and sells the deal to investors. In most cases the wholesaler is not actually buying the house but instead buys it under contract and then sells the contract. Wholesalers simply find deals on properties using direct mailing methods and then purchases the contract with the intent of selling the deal to their list of investors. The money in wholesaling comes from selling the contract to an investor at a higher price than the wholesaler paid for it originally. 

Act quickly when buying from a wholesaler

When buying from a wholesaler, it’s important to act quickly. While different wholesalers handle business differently the underlying goal is to sell quickly. Some wholesalers sell to the first investor who offers the asking price. Others will set up online forms to fill out and submit and whoever submits the highest price gets the property. Thus, it’s imperative when buying from a wholesaler to move quickly if you are interested in a particular property. 

Where to find a good wholesaler

When finding a good wholesaler it’s important to look around. Like with a typical real estate agent you want to make sure you find the right one. As with most things it can be hard to find a good one at first, but finding one that works for you takes diligence. 

One obvious place to begin your search is online. Many wholesalers have websites set up for prospective investors to browse properties. A simple google search of ‘real estate wholesalers in’ your area may yield fruitful results. Online searches can also be hit or miss. 

Wholesaler marketing materials

Sometimes finding a good wholesaler is as simple as looking around for their marketing materials. Look for flyers in coffee shops and other public places as well as billboards, online ads, and other Craigslist posts and social media posts. If you come across their marketing then you know they are looking for buyers.

Real estate investors groups

Many areas have meet up events for real estate investors to get together. Often times, wholesalers will show up at these meetings looking to present deals to investors. If you’re looking to get a good deal this way on an investment property, it certainly does not hurt to show up to these events.

Ask locally

Like with most things, sometimes the best way to find the right service is to ask around. Contacting investors can sometimes yield positive results, though they may not want to divulge their own secret to getting good deals. Posting on online real estate message boards is one option as well. Real estate agents, title companies, and even banks are good places to look as well as wholesalers often contact them for lists of people looking to buy.

Things to keep in mind when buying from a wholesaler

Buying a house from a wholesaler can be great if you find a truly great deal. However, there are certain things you should always look out for to ensure you’re actually getting a good deal on the property. Three major things to make certain you pay attention to when dealing with a wholesaler are; inspection clauses, making sure the numbers are right, and understanding the contract. 

Inspection Clause

With most wholesalers, there is no escape clause. Normally in transactions, once the contract is prepared you have time to do your inspections and make certain everything is right. With a lot of wholesalers however, often times this process must be done before the deal goes under contract. If you don’t do this process early and quickly you could risk losing all your earnest money. 

Check the numbers

Secondly, always make sure the numbers add up. One of the single biggest mistakes people make when purchasing from a wholesaler is not checking the numbers. The sellers are looking for deals too, so it’s important to take time to run the numbers yourself, possibly with the help of a realtor or an advisor. It’s key that you run through the after repair value as well as the repair costs to make sure you’re actually getting a deal. 

Understand the contract

The third thing to keep in mind is the contract itself. Typically there will be two contracts, one between the owner and the wholesaler and then a second one between the wholesaler and you. The contract will include all the specific details regarding earnest money, closing costs, and deadlines. Have an advisor assist you so that you are well versed in the contract. 

Conclusion

When purchasing an investment property from a wholesaler there are a number of factors to consider. Firstly, you want to make sure that you find a good and reputable wholesaler to buy from. Like with buying anything from anyone it will be a process to find the right one. You’ll want to do your research to make the one you buy from is right for you. Not everyone who does wholesale real state is good at it either, so you’ll want to thoroughly evaluate everyone and make sure that the one you are purchasing from has actual deals.

You also need to understand the process. Wholesale real estate is different from traditional real estate and wholesalers are different from regular real estate agents. Make sure that you fully understand the contract from every angle and that the numbers you independently produce match the numbers provided to you. At the end of the day, when done right, buying an investment property this way can be highly rewarding as you find great deals on homes. This method of buying is a great way to go since you’re essentially paying for someone else to do all the heavy lifting of finding a great deal on a property for you. The process begins by simply looking around to find the best deal for you. Then, be smart and diligent, act quickly and efficiently, and don’t be afraid to have someone assist you through the deal.

Direct mail marketing remains one of the most cost-effective forms of marketing across industries. Particularly within the real estate industry, direct mail can be one of the most fruitful strategies for generating leads out there. The top real estate investors cite direct mail among their top sources for leads. For investors who want to the most cost-efficient way to get leads post-skip tracing, direct mail is among the best ways to go.

Different forms of direct mail

In general, there are three main forms of direct mail that investors and wholesalers use when sending out direct mail; postcards, lead letters, and blind offers. Once your skip trace is complete and you’ve compiled a list of leads you can begin to send out mailers to present information regarding your services. Each one of these different forms of direct mail has advantages and disadvantages. Knowing which to use is important to creating the most potential customers or clients. 

Postcards

When it comes to cost-efficiency, postcards reign supreme as one of the easiest and most effective messaging tools. For those looking to get the largest audience for the best price, postcards are the best. When done right, postcards have proven to be some of the most effective tools at generating reliable leads. 

Another huge advantage outside of the cost, is how customizable they are. While there are certain elements every postcard should have, beyond that they are yours to create. They come in several different sizes depending on your needs. Keep in mind however, that larger sizes cost more than standard 4×6 size cards.

Postcards are also compact enough that you can pack your entire message into it in a digestible way guaranteeing that your message is consumed before being discarded. Part of that depends on your design, but with postcards you have total control over the design and can craft them specifically to reach certain individuals. 

The only major drawback to postcards is the lost time spent creating your card design targeting individuals who will not engage with your business services. However, compared to some other forms of direct mail, this still makes it among the best types of mailers.

Lead Letters

In a world that is constantly and increasingly being run by technology and the digitization of everything, sometimes it doesn’t hurt to get back to the basics. Like with postcards, lead letters are incredibly customizable. Lead letters can either be hand-written on a card or a piece of paper, much like a thank you note, or professionally written on letterhead. It’s entirely up to how personal or professional you choose to make the letter. 

A lead letter informs a homeowner that you are interested in purchasing their home. However, what makes a lead letter different from other forms of direct mail like a blind offer (see next section) is that it invites the owner to contact your before an offer is made.

An advantage to doing lead letters is that they allow you to handle offers on individual properties and gives you total control over each offer. These letters also give you the ability to build a more personal relationship with the homeowner and lets you make deals on a case by case basis rather than simply distributing mass produced messages that are the same for everyone else.

The downside to doing mass marketing by lead letters is that you will inevitably waste time on people who will not sell you their house. Because these letters are more personable than a postcard, you spend even more time creating them. Additionally, the postage for lead letters is higher than that of other mailers. 

The biggest disadvantage however is as a real estate wholesaler or investor, you will waste time communicating with homeowners who will not sell their house at a discount.

Blind Offers

A blind offer is the most extensive mailer you can send. While in terms of getting down to brass tax it is the most effective and cuts out pointless communication with someone who will not sell, it also has by far the most drawbacks. 

First let’s go over the benefit of sending blind offers. Blind offers typically include one to two page offers enclosed in an envelope containing a direct offer to buy the property. The implication here is that you as the investor have already done the work to prepare an offer prior to mailing. Once received the homeowner has three responses she or he can give; decline, accept, or negotiate. 

From a time frame perspective this is the most efficient campaign to run since you immediately know from the first response if they are interested or not. If your offer comes back rejected then you know immediately not to continue pursuing and you save time that may be spent with lead letters or postcards that could still result in a no-sale. 

From the perspective of the owner as well, blind offers immediately lets them know where you’re coming from and immediately signals that you are looking to buy at a discount. Since your points of contact relay immediate responses, positive or negative, these are the most efficient campaigns to track and monitor.

There are however some downsides to this form of mailer. For starts, many homeowners who may be open to buying, may be turned off immediately by the low offer and will decline your offer right out of hand. 

Another disadvantage is that you will inevitably be missing out on deals because you are putting your offer together without doing any first hand research on the property. Because you cannot examine any special circumstances. Particular situations may justify spending more on a property, but by packaging your offer blindly without knowledge of any such situations you may be missing out on an opportunity if your offer is declined.

The third main disadvantage of doing blind offers is the cost. Mailing out two pages in an envelope is much more costly than mass mailing postcards.

Conclusion

After your skip trace all that’s left is to begin sending mailers. As evident, there are several different forms of mailers one can send each with their own pluses and minuses. Postcards are by far the most economic mailers to send as they are mass produced at the most affordable price and let you to reach the largest audience possible. Lead letters let you be more personable with your prospects and manage them on a case by case basis. However, with both options you will inevitably end up spending time communicating with people who are not interested and that time may cost you in other areas.

Direct offers dramatically reduce that time by essentially cutting out all the back and forth and cutting straight to the chase. Yet this method, while the most direct and efficient as far as timing is concerned, has a number of drawbacks. Due to the potentially perceived abrasiveness of the mailer it can turn people off. Ultimately, you should make a decision based on what you think is the best method for your real estate operation.

How to use Turbo Letters for effective direct mail campaigns

Post-skip trace, for highly effective direct mail campaigns, use Turbo Letters to get your information out. Turbo letters offers the best and lowest pricing for direct mail in the real estate industry. Additionally, Turbo Letters promises a quick 2-3 day turnaround so you aren’t waiting weeks for your product like with other services. If you need postcards, professional letters, personal letters, etc., Turbo Letters has you covered. Just go to their website and select your template to get started with fast and easy direct mail.

You have likely heard the saying: “dress the part” before. However, being a real estate professional doesn’t always come with an established dress code. It doesn’t mean that the clothes you choose will not influence your career. On the contrary, first impressions – including how you dress – can make or break a real estate deal. 

So, what kind of clothes should you wear as a real estate professional? Here are a few tips on what to pick in your wardrobe and what to leave behind to dress the part of a successful professional. 

• Dress for your audience

Real estate jobs come in many shapes and circumstances. Maybe you sell slinky commercial buildings in the heart of a big city. Or on the contrary, your principal business may come from farmland in a rural area. Most of your clients may be millionaires looking for mansions, or you deal with a lot of foreclosures which have seen better days. You may be spending a lot of time in your office, or on the contrary on the field. 

Either way, your scope of work may be very different from one day to the next, and your clients have different expectations. Dressing the part as a real estate professional involves, first and foremost, knowing your audience. You don’t want to walk through the fields in a business suit any more than to show up at an important meeting with high-end clients in the same clothes you would be wearing to show a run-down foreclosure who may require exploring the attic. 

When deciding what to wear that day, check your agenda first and bring a change of clothes with you if you will be attending to different tasks and won’t have time to stop on the way. 

• Keep it professional

Real estate pros may have a particular relationship with their clients, but they should remain professional at all times. Avoid anything too casual, like athleisure clothing, or too revealing, like mini-skirt or tank tops. 

First and foremost, no matter what kind of clothes you will be wearing that day, make sure that they are clean, pressed, and fit well. Even you will be walking through the snow to inspect a rural property that day; it is no excuse to show up in a wrinkled shirt on which you inadvertently spilled your morning coffee. 

It is a good idea to carry a spare shirt and some stain remover to go in your car or your purse to prevent a last-minute disaster. You may also want to invest in a hand steamer to look presentable in a pinch. Finally, getting your clothes hemmed and tailored will ensure that you always look your best. 

Clothing rental subscriptions can help you maintain an up-to-date closet without breaking the bank. 

• Details matter

When it comes to first impressions, there is no way around personal hygiene. Even if you wear the most expensive designers’ clothes and the fanciest car, it will come down to nothing without appropriate grooming. A neat haircut and a polished manicure will do wonders to look professional in any circumstances. 

Go for more conservative and neutral options that will always match your look and offer the most neutral backdrop depending on your circumstances.