You’ve finally done it! You closed on your first deal. If you’re fairly new to the industry, closing a deal can be very exciting, but at the same time – it’s the start of your investment journey. After taking care of the “purchasing a property” part, there’s still a lot of things to do. Don’t just let go and expect things to take care of themselves. To avoid problems that might pop up in the future, here are some things to expect after closing on your first deal.
IT CAN GO BETTER THAN WHAT YOU WERE EXPECTING
A lot of so-called professionals in the business will tell you that there will always be roadblocks, even getting that sweet deal. Your first deal might end up pretty well – so well in fact that it gives you the much needed push to give it another go, and purchase another property!
If all goes according to the plan, you’ll essentially feel empowered, thinking that investing in real estate isn’t as complicated as you previously thought, only to find out the hard way that it’s not as easy all the time. So, how do you make sure everything will be smooth in the long run?
Knowing your end goal will help you when you are purchasing an investment property. Do you intend to flip the house, or keep it as a rental. Knowing your ultimate exit strategy will help you determine the right purchase.
Humble yourself and take some time to learn from others who have gone before you. This let’s you know how to properly evaluate a home’s worth, what type of expenses to look for and have knowledge of the current market situation. You’re bound to make a few minor mistakes here and there, but these small mishaps can be a valuable lesson for the long term.
YOU GAIN A HEFTY PROFIT
Earning large profits is generally the main purpose of investing in real estate. This is what everyone is hoping for once they start to invest, but again, anything can happen if things are not taken care of properly.
It’s quite common to easily misunderstand the current market situation. A lot of investors get their estimates wrong, which can dig deep into their pockets, and might even cancel out any potential profits. Making a good profit on your first, or any deal, isn’t a guarantee. However, it is by no means impossible.
If the thought of closing your first deal makes your palms sweat and heart beat a little bit faster, that’s completely normal. You can never be too careful, so plan things out, and you’ll be prepared if it turns out badly.
THERE’S GOING TO BE A MIX OF EMOTIONS
Nothing beats hands-on experience. Regardless of whether you’ve done your homework, learned how to effectively value an investment property and how to talk to your clients, stepping on the actual playing field is where the game starts.
There comes a point where you put down all the notes you’ve compiled to actually start making that first offer. When that time comes, you’ll view things in a different way. Not so long ago, you were just picturing it in your head, but now you’re actually doing it.
Simply relying on hearsay isn’t enough. You learn a lot more by putting in real effort. Don’t set your expectations too high, especially when it comes to profit. The best practice is to have a team work with you. This allows you to be more rational in making any decisions & keep your emotions in check.
Remember, a good deal starts with the purchase. Having an experienced real estate investor to run questions by, and to help you out is key to keeping you on track. In this manner, your team can help you avoid, or minimize bad deals. If you happen to discover later that the deal was bad, and potentially unprofitable, having an experienced team can help minimize the loss, or perhaps even turn it into a profitable one instead.
IT’S MORE THAN JUST ANOTHER TRANSACTION
It’s textbook. You close the deal, hit your numbers, and walk away with a solid profit. If you continue on with that trend, you can really build a nice investment real estate business. You start to think that every deal is the same, until you encounter a situation where nothing that worked in the past is working for the present situation. This is especially true given the sheer amount of variables that can affect the market.
Closing a deal (a profitable one I hope) is only half of the excitement when it comes to real estate. What most investors fail to understand is that real estate isn’t all about houses. It’s a people business. Close on your deals, but do it in a way that you build relationships. Take into consideration the seller or client as a person, not just treating them merely as part of a transaction.
The current seller you’re dealing with may have other properties to sell. They may end up being a potential buyer of one of your properties, or provide you with a renter. Treating your clients as a friend (not just a number) can add extra value to you, and your business by developing long-term relationships.
Real estate investors always focus on the technical side of things. How do I work my numbers? How do I bounce back from a bad deal? Or where do I go from here? Spending time on your due diligence, combined with a solid and supportive team to help you keep the deals rolling is the key.
Of course, it helps to work with the right people in business, especially those who have first-hand experience when it comes to real estate dealings. Our team at Strategy Properties can help you do just that, and so much more. We can offer you outstanding properties, where all the work has already been done, so you won’t need to worry about anything! To learn more about our services, contact us at (734) 224-5454 or reach out to us via email at firstname.lastname@example.org.