Buying Your First Investment Property: 8 Things You Need to Know

Buying your first investment property can seem daunting. However, getting started in real estate investing can be a great way to move forward in your path to financial freedom.

Buying Your First Investment Property: 8 Things You Need to Know

- Cashflow - Effective use of leverage - Appreciation - Potential Tax Benefits



- Not hands off - Low Liquidity - Could lose value Before investing in a rental property – it is essential to start from sound financial footing. There is a high transaction cost to buying and selling real estate.

When deciding on your investment strategy for your first property, you will have to choose between buying a single-family residence (SFR) or a multi-family building. While many people see purchasing a single-family as a steppingstone into multi-family, that is not necessarily the case.

Single-family vs. Multi-family

How to Pick a Property

Many investment styles can work. Real estate investing is not a one size fits all sort of process. It is crucial to figure out your preferred investing model, define what property fits this model, and find a property that fits these criteria.

Getting a loan on an investment property can be a bit different than a mortgage on your primary residence.


Building Your Team

Please do not go out to the world and ask people if they will be on your investing team. Relationships with the people you will work with for investing in real estate should be more organic than this.

To report taxes at the end of the year, you need accurate income and expense records. These records will also be handy for comparing property performance to your projections and allow you to make adjustments to your investing strategy.

Tracking Income and Expenses