INVESTORS’ CORNER: In real estate investing, know your market

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For some of you who have bought courses and attended seminars, creative real estate might be something that sounds great in theory but doesn’t “Creative” real estate means different things to different people. To real estate investors, it describes “out of the box” methods of buying and selling real estate. To real estate agents, it means “another stupid crazy offer that won’t work and how the heck am I supposed to get paid?” To owner/sellers, it is something out of the ordinary, certainly not the all-cash deal that they’d like to see for their property, but it just might be a lifeline that is thrown to them right before they drown or even a deal that works out better for them financially that an all-cash offer would.

In today’s market, the opportunity to buy and sell properties creatively is bigger than at any time in the last decade, maybe the last few decades. But to do creative deals, you need to know what a good deal is. And a good deal is different for each person, depending on their own personal goals. In addition, you need to lay down a foundation of knowledge about your market place – the people, the properties, even the dynamics of jobs, transportation and schools.

Once you know your marketplace, you are better able to determine if a property is a “good deal” for you or not. The adage says that you make your money when you BUY real estate, not when you sell. This is true. If the deal isn’t good up front, you may be able to squeak out of it with a profit or a break even. You want to go into deals with your eyes wide open and the ability to confidently walk away from any deal that doesn’t fit your parameters.

Once you know your marketplace, you are better able to determine if a property is a “good deal” for you or not. The adage says that you make your money when you BUY real estate, not when you sell. This is true. If the deal isn’t good up front, you may be able to squeak out of it with a profit or a break even. Yes, time heals all wounds, including bad real estate decisions, but as many people found out, they may not be able to hold onto a property long enough for time to solve the problem. You want to go into deals with your eyes wide open and the ability to confidently walk away from any deal that doesn’t fit your parameters.

JC Underwood is a director at the Metrolina Real Estate Investors Association, which provides education, mentoring, and networking for real estate investing in the Charlotte region. He can be contacted at [email protected]. For more information, visit www.MetrolinaREIA.org.