In this article I am going to show you some real estate investing advice and how real estate investors make their money through real estate investment. Probably the best and simplest way of explaining how a person makes money from real estate is where an investor buys a property for a certain price (Normally low price). The aim is to sell that property at a higher price.
The way to make money on a real estate investment is not different to the way other kinds of investors make money with different opportunities. If you have a think about the way that other kinds of investors make their money though the stock market, they place their money into a stock when it is at a certain price. When the stock has increased in value the investor then sells it at a profit.
A strategy for capitalising on your real estate investment is buying property below market value. When the property has appreciated in value the investor will sell the property once it has increased in value. This process of buying low then selling high is the key strategy that is used.
Now that you have some real estate investment advice, the next question is... what type of an investor are you?
The key to unlocking your real estate success is to understand what type of an investor you are. Below are four different types/grade levels of real estate investors. These are levels of which a real estate investor is likely to proceed with and develop as he/she becomes more experienced.
Here are the four types:
1. The "play it safe" investors own their homes. They also invest in other types of real estate, but are careful and cautious and review all the pros and cons first, or else they wont get into the game.
2. This type of investor often owns 1-2 properties as well as their own homes. Their method of investing is to do it in small manageable steps.
3. Investor no.3 are known for their risk taking and are quick to discern good deals. Money to them is a means to something rather than the goal itself!
4. The full-time property investor is a full on fanatic real estate investor. They are always clued into opportunities every day by scouting newspapers and internet outlets. These investment freaks tend to have a good solid understanding in real estate. They are people who take action quickly.
So which of these four levels represent you as a property investor? Well, the answer to that may depend on the risks you take! If your not big on taking risks, the first or second levels are most likely for you. If you are more of a risk taker, then you are more likely to position yourself third. As with any kind of investing however, caution pays off in real estate, especially for beginners who have yet to learn the rules of the game. Some experienced investors are held back by their caution. However, some experienced investors are held back by their extreme caution, and always will be. These are the real type-one investors. Lifelong type-two investors often lack the drive that motivates others to become type-three risk-takers as they gain confidence.
