Don’t be stupid. Buy smart.
Guidelines on which properties to buy, which to avoid, and when to take action
I often see novice investors make extremely poor property purchases as a result of too much ambition and a lack of market knowledge.
Let me give you an example. A client of mine once called me saying he found an investment property with a capitalization rate of approximately 11% and over $500 a month in positive cash flow. Not bad, right? Wrong. As mentioned previously, cash flow is not the only consideration.
After careful analysis, I determine the price he was paying was about $26,000 over market value! In other words, purchasing this property would instantly reduce his net worth by $26,000. The cash flow quickly became irrelevant.
Buying smart comes with experience and novice investors must recognize this in order to prevent making drastic, and very costly, investment decisions.
If you ever have any questions about buying smart, any at all, please don’t be shy. Give me a call or send me a text or email. I am always willing to chat real estate over a cold beer or strong coffee.