Advice on Buying & Selling Real Estate in Arizona

If you are looking to invest in real estate, the first thing you need to do is determine whether you are going to pursue a short term or long term strategy. These are the main strategies when it comes to purchasing real estate.

Short Term Investing
This seems to excite people and all of the late night real estate gurus have people touting their quick turn around, high profit deals which keeps the gurus well fed by selling lots of book, CD’s and coaching (and maybe some real estate). Don’t let that fool you though; without the proper training you will lose your shirt and they never interview those folks or show you the hate mail the gurus receive from the tens of thousands that lose it all trying to invest before they are educated.

A few years ago, it was easy to buy low and sell high in the Arizona market, as well as several others. A lot of people made a lot of money, but as the market turned a lot of people also lost a lot of money and will be recovering for the next decade.

With the right training, you can purchase for a short term profit, where you buy an under priced or distressed property, possibly do some sprucing up, and then sell it for a profit. The turn around time can be anywhere from a day (if you assign a contract) to a year or more for a massive renovation. The profits can range from a few hundred to several hundred thousand, and the two critical components here are knowledge and a solid exit strategy. Most of all, keep in mind that the profit is made on short terms deals the day you purchase the property, not when you sell it. If you don’t understand this, then you need to get some real estate investor training before you risk your hard earned money in real estate investing.

Long Term Investing
Building an Investment portfolio is one of the best decisions you can make for your financial future. When buying for long term gain (a.k.a. buy and hold), you still need to buy smart, meaning you don’t want to overpay, but you also have to account for sustaining the property for the long haul. This includes things like mortgage payments, taxes, upkeep, etc. The ideal property will not only appreciate over time, but will provide you cash flow where your tenants actually pay your mortgage and you have a little left over (which I recommend reinvesting).

If you are buying a non income producing property, such a land, this is a higher risk and can produce a higher payoff, but is also subject to master plan changes, environmental changes (such as finding toxic soil after years of ownership), and is not recommended for the novice investor. As a former Vice President and Project Manager of a real estate investment firm, I have actually made plenty of profits in land and I enjoy investing in land. In fact, just today I spoke with a developer friend and negotiated a deal on some land in Georgia where I will make roughly $80,000 the day I close – and that is based on today’s value. My goal for this land is to hold it for the long haul, but if the right offer comes along, I could be tempted to give it up. Best of all, I am leveraging less than $1,000 to add over $80,000 to my balance sheet – and that’s a pretty solid return.

If you would like to learn how to find real estate deals and implement creative financing strategies, I want to invite you to a free creative financing seminar that my real estate group is holding in Scottsdale this coming Saturday, September 20th. It is by invitation only, and I have a few tickets left, so please call me at 800-453-9290 (24 hour voice mail) and I will get back to you or have one of my team members contact you.

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Until next time…

Anthony

P.S. – What are you doing today, to ensure a better tomorrow?