Real Estate Investing 101, Buy Low - Sell High

Most people have been taught from an early age that to make money in the real estate market, they must buy low and sell high. While that is a simple concept, it is very difficult to know exactly what is low and what is high because the marketplace is always changing. Right now might be one of the best buying opportunities in a generation in the U.S. real estate market or it could be a giant temptation that will draw in investors while prices of homes continue to drop. While I am no real estate expert, my personal opinion is that until the huge glut of new homes that are sitting unsold in many U.S. cities are sold - there is no way that the U.S. real estate market can start growing again.

Making good investments also requires being able to hold onto those investment during both good and bad times. Too many times, investors in U.S. real estate are financially overextended. Experts tell me that to be ultimately successful in real estate investments, the investor must have enough financial resources to ride out the hard times until better days come in the future. There are dozens of variables in the buy low/sell high real estate market and that is why many novice investors end up losing money even in an expending market. Unlike other investments, real estate is taxed heavily - requires upkeep and must be insured in most cases. Without sufficient investment capital to pay these never ending costs of doing business, the average investor could find themselves either out of business or at the very least struggling just to hold on until market conditions make it favorable to sell in the future.

For the investor that has the financial resources to not only buy real estate when the market is low, but also to have enough cash on hand to pay the numerous cost of doing business - the long term investment returns on real estate could be tremendous. The problem most investor face when investing on a large scale in real estate is that their investment time horizon is too short and they run out of money before their investment is able to create a big payday for them. It would be better to save a bunch of money first, before venturing into the real estate investment marketplace. Then start your real estate investments on a very small scale and don't let the number of properties you are purchasing grow faster than the amount of cash you have on hand to pay the associated costs of taxes, insurance and up keep.

For most Americans, buying a home is their biggest lifetime investment. While some people buy a home for family stability, if the home they are buying is not affordable to them - the last thing they are going to feel is stability when trying to payoff that home. Whether your real estate investment is the home you are currently living in or it is a property that you are investing in for a large return later on are exactly the same when it comes to the expenses associated with the property. The costs associated with real estate investment add up to a huge amount of money over the long haul and there is no way to get around paying those expenses. The last thing any successful real estate investors has is have a short term horizon when it comes to their investments. When investing in real estate, follow the lead of investment pros and not the lead of the short term 'get rich quick' crowd.

Title: Real Estate Investing 101, Buy Low - Sell High
Written: April 18th 2008
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