What Kind of Real Estate to Invest In?

What Kind of Real Estate to Invest In?By [http://ezinearticles.com/?expert=Dave_Lindahl]Dave Lindahl
Real estate investing is a huge topic. There are so many choices, so many types of real estate to invest in. Mobile homes, single family homes, apartment buildings, warehouses, office buildings, strip malls...
How do you know what kind to pick? Should you specialize? Is it better to have diversity in your investment portfolio? Or should you stick to one kind of real estate?
Let's say you find a property that you think might be a good deal. How will you know? Can you buy it and be certain that you'll make a profit?
Worst of all, if you've heard of the real estate bubble, you may be a little scared getting into real estate investing. With mortgage lenders going under and banks closing, is real estate investing the right move right now?
Real estate investing is still, hands down, one of the very best methods for real wealth creation, and just about anyone can do it.
With the proper education in real estate investing, you can learn the proper methods, the right kind of real estate to invest in, and the right way to structure your deals.
And there really isn't any need to worry about any real estate bubble. After all, lots of millionaires made their start in down markets. Even in the Great Depression, some people became very, very wealthy. You've heard the expression "buy low, sell high"? Real estate investing works the same way. And a down market means prices will be down. Armed with the right knowledge, you'll know when to get in, and when to get out.
Now, to address the question of what kind of real estate to buy. There is no wrong type of real estate to buy. If you purchase real estate at the right price, in the right way, and either hold on to it or sell it to someone for a higher price, you'll make money. This is a very simple formula.
However, there are three places you could end up using this strategy. Number one, you could end up buying yourself a job. If you buy lots of little pieces of real estate, either mobile homes or single family houses, and you're running around cutting grass, collecting rents, fixing leaking sinks, you're going to be extremely busy. You won't want to have many properties - there won't be enough hours in a day! That's not real estate investing, that's buying yourself a job.
The second place you could end up using our investing basics formula: you could end up financially comfortable, or even well off. These real estate investors do buy low. They do sell high (if they sell at all). And their deals are structured properly, so their properties have positive cash flow. They may even hire someone to do their some of the property maintenance for them. They have a small portfolio of real estate, single family homes, maybe a duplex or two, and maybe they retire a little early when the mortgages are paid off. Not bad.
But the third option, the top option, the best place to be is to be incredibly wealthy. Real estate investing can take you to all three places, and the third option is clearly the best. Here's a short list of what these people are doing.
First of all the really wealthy and successful real estate investors are buying multi-family properties. They understand the concept of unit pricing, like in the grocery store. You buy more units per dollar and you get value. Real estate is also measured in units, or number of living configurations. You can buy one unit for, say, $100,000 (let's leave the financing out of this scenario to keep it really simple), or you can buy 10 units for $100,000. If those ten units are all in one building, you've hit the jackpot. According to unit pricing, you've gotten more value for your dollar.
Another thing the really successful real estate investors do is they buy in the right markets at the right time. If real estate is doing very poorly in one city, guaranteed there's another city that's doing well. An industrial city in the north will have a different sort of economy than a tech-based economy in the west. When one is up, the other may be down. Owning and controlling real estate in different markets at different times can generate some real wealth, fast.
Finally, the really wealthy real estate investors understand how money works. Money is like water. It's healthy and alive when it's moving, like a stream. When it's stagnate, when it's still, when nothings coming in or out, it's dead. Real estate investing that models healthy bodies of water, bodies that move and flow, are the ones that are truly healthy and vibrant and create wealth.
David Lindahl, also known as the "Apartment King" has been successfully investing in single-family homes and apartments for the last 14 years and currently owns over 7,000 units around the US. David regularly shares his secrets and experience on the same stage as Tony Robbins, Robert Kiyosaki, and Donald Trump! For two FREE copies of his highly recognized newsletter Real Estate Insights, please go to http://www.davesoffer.com/ezine
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