The lazy way to invest in real estate is to simply buy low and sell high. The best way to put any money into real estate is to buy where the best price is.
You could spend a lot more time thinking about this than you would if you were to buy your first home. For instance, if you bought a home that was $100,000 more than you needed to pay for it, and you bought it at $100,000 below market value it would cost you $100,000 over the life of the house. Of course, that isn’t a typo, because that is actually how much it costs to rehab and flip homes and rebuild them.
When it comes to investing in real estate, the best way to put any money into the market, is to buy real estate that’s 100,000+ over your actual needs. If you buy a home at $100,000 and you want it to sell for $200,000, you will lose $1,000 in equity. That is the best way to put any money into an asset, because you can only invest so much into real estate.
We were recently on a real estate podcast a few weeks ago, and we were discussing the difference between what we call the “lazy way” to invest and the “hard way.
The lazy way to invest in real estate is to buy a home and then wait and hope that it will sell. When you buy a home, then all you have to do is wait and hope that it will sell. What if you don’t get that home to sell for a year or two? Then you’re just sitting on your cash, and you have nothing. The lazy way to invest in real estate is to buy a home and then be patient.
I think this is the wrong way to invest in real estate. The wrong way to invest in real estate because it can be very, very difficult to sell a home, especially when compared to buying a new one. This is one of the reasons I don’t invest in real estate. I already know if a house is going to sell. I don’t need to wait for that to happen. I can buy a home and just hope it will sell.
It’s very rare that someone can sell a home and say “Now I can pay off my mortgage”. They may have a job and a paycheck and their rent, but they really can’t sell a house unless they’ve sold it to someone else. This is why I recommend that you wait. You can’t buy a home and expect to sell it soon. I know this because I’ve gotten multiple offers on properties I have already.
First, you probably won’t be able to sell your current house in a year or two. Second, you might not be able to get a mortgage on your current home for quite some time even if you wanted to. But if you do get the opportunity to buy a new home, it might be a good idea to spend some time with a real estate agent before making a purchase. Real estate agents usually do this for a commission.
Here’s why: Real estate agents usually make more money than you do, but they also usually get more commissions. A real estate agent who can get a commission is probably going to give you more value for your money. They also usually have access to more information about your home and the neighborhood.
My wife and I decided to put some money down on a new home in the summer of 2015. The agent we chose was very helpful and did a great job of explaining the properties we liked and the other properties we were considering, and helping us make the decision from there. One of the reasons we chose this agent was because they had access to the MLS for all of the city’s listed neighborhoods.