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The 5 Steps to Maximizing Real Estate Investing Potential

Here is a very interesting article that discusses how to maximizing real estate investing potential, written by Ben Stoodley on equities.com website.

I completely understand how there are always critics out there in the world, and it would appear that I am one of them by writing this review. However, I also find it interesting how some writers throw articles together without really thinking of them. Maximizing real estate investing potential is not as cookie cutter as this author makes it out to be.

Ben highreal1lights the 5 steps as; Buy, Rehab, Rent, Refinance, Repeat. The problem that I have with this article is not the simple formula he outlines, but the strategy behind it.

The hook of the article is the “age old question” of whether or not to “buy and hold” or “fix and flip”. In order for an investor to answer this questions, according to Ben, they need to evaluate their personal factors; “age, goals, financial situation, location, timing, etc.”

Although there is some validity to answering those questions, it is also silly to think someone younger has a higher likely hood of taking on more risk than someone older. These does no equate to someone older not being willing to take on some risk. Nor does it mean that any age group would lean more towards buy-and-hold than fix-and-flip.

His five steps also don’t make any sense if an investor is going to utilize the fix-and-flip strategy. With a fix/flip investment property, there would not be the Rent or Refinance portion of his theory.

The bottom line is this, do you need to have a strategy going into an investment property? YES! If you are going to purchase a property where you are going to fix/flip the property, do you need experience in managing those renovations? YES!

In order to maximize real estate investing potential, your strategy has to be crystal clear going into a transaction. Some properties are great rental properties, while others have the profit in them to fix’em up and sell them. Each property is unique in it’s opportunity as it is in its history.

Having rentals as a on-going stream of income is a great strategy. However, if you’re able to flip a few houses to accumulate the capital needed to purchase your next rental, that is leverage.

I thank you for taking the time to read the post. Leave a comment below and make sure you share it on Facebook and Twitter.

Until next time,
Mike

*you can read the whole article HERE

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