May 14, 2011 · 6:30 PM
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"What Is a Real Estate Investor?
Real estate is one of the best investments that a person can make considering that it almost always increases in value over time. Individuals that invest in real estate can create long term wealth for themselves and for their families. Enclosed is information on what a real estate investor is, as well as general information on how to become a real estate investor.
o A real estate investor is someone who purchases one or more properties with an intent to create either a one time or long term profit from the sale or use of that property. Real estate investors can own as few as one property or massive numbers of income producing sources. There is no prerequisite set on how few or how many properties that a real estate investor can own at any given time.
o Real estate investors come in all shapes and sizes. Some investors will use their own liquid capitol to invest back into real estate, others will take a home equity loan out on their residence for capitol and others will create a partnership with like-minded individuals for real estate investment purposes.
o There are several types of real estate investors. Some investors will purchase properties to rehabilitate and remodel and then flip for a profit, others will purchase properties and use them as rental homes to create income, while others will invest in commercial properties.
o Intelligent real estate investors will purchase properties that are either in distress (danger of foreclosure), foreclosed properties or by assuming the loan on a property. This allows for minimal investment with the potential for maximum return. It runs along the same principal as trading stocks inasmuch as one should "buy low and sell high."
o The main benefit of real estate investment is the potential for long term wealth. If renting properties out for long term profit, it is wise to use the profits earned from the rental to pay off the outstanding balance on any mortgage due, thusly making 100% return on the investment over time. Likewise, when purchasing a property to "flip" and resell, taking the profit from that property and applying it directly to another property so that one would have long term investment capitol.
o There is no set amount that one has to invest in order to become a real estate investor. On a loan assumption, for example, one could invest as little as $4,000 to take over a loan on a property and own that property outright. Regardless of the initial amount invested in real estate, the potential for return profit greatly outweighs the risk."