PAY ATTENTION TO THE BROADER TRENDS Conducting thorough market research and analysis beyond your local market is essential. Real estate investors should analyze overall market trends, property values, rental rates, and any regulatory changes that may impact the real estate market. This research helps investors identify properties with the potential for profitability. ESTABLISH NETWORKING FOR REAL ESTATE INVESTING Building a solid network in the real estate industry is another critical factor for success. Collaborating with trusted and reliable real estate agents, contractors, brokers, and property managers can provide valuable insights, access to off-market deals, and ongoing support. Networking also allows real estate investors to stay connected with industry experts (e.g., REI specialized accountants, attorneys, etc.) and to learn from their experiences. FINANCIAL PLANNING AND BUDGETING ARE CRITICAL Successful real estate investors understand the importance of thorough financial planning and project budgeting. Before investing in real estate, it is crucial to assess the available capital and determine the overall investment budget. This includes considering the cost of acquiring a property (buying, holding, and selling costs), financing options, and potential renovation or maintenance expenses. Further, investors should stay current with regulatory changes impacting the real estate market. Changes in zoning
laws, tax regulations, or building codes can significantly affect the profitability of an investment. Investors can adapt their strategies accordingly and navigate potential challenges by staying informed about these changes. Investors should also evaluate each property’s potential return on investment (ROI) cash-on-cash return. The latter is how much you have to put at risk versus the return. (Think of it like a stock portfolio— how much risk is too risky?) Your evaluation should involve analyzing potential rental income, property value appreciation, and any potential tax benefits. By calculating the ROI using all these factors, investors can determine whether an investment aligns with their financial goals and expectations. Additionally, Murphy’s law is a given. Investors should create a contingency plan to prepare for unexpected expenses or changes in project or market conditions. A financial buffer will help mitigate risks and provide flexibility to address unforeseen circumstances. This proactive approach to financial planning ensures you are well-prepared for any challenges. PARTNER WITH A PRIVATE LENDER TO SUPPORT YOUR INVESTMENT EFFORTS Real estate investors should consider private lending to finance their endeavors. Banks face high scrutiny, regulations, tight underwriting, and higher liquidity requirements. Because the exacting requirements of banks do not shackle private lenders, private lenders have more flexibility to consider all aspects of a borrower and the projects they want to pursue. In addition, private lenders can
quickly adjust their product offerings to address the challenges of any market. In short, successful real estate investing in 2024 requires conducting thorough market research and analysis of financial planning and budgeting as critical elements of a strategic plan to achieve success as a real estate investor. Adapting to changing market trends and regulations is also essential. By embracing these key factors, real estate investors can navigate the industry’s complexities and maximize their oppor- tunity for success in 2024 and beyond. •
JOHN V. SANTILLI
John V. Santilli is the chief revenue officer for RFG. He joined the company in July 2019 and is responsible for all opportunities connected to its RFG, including expanding the company’s sales channels to maintain its position as a leader in rehab financing. Before joining RFG, Santilli had 25 years of lending and marketing executive leadership experience across multiple private and public marketing- dependent companies. He managed companies from startup to maturity, ranging from $2.5 million to more than $50 million in annual revenue. Santilli earned a master’s degree in management from the University of Pennsylvania and a bachelor’s degree in business administration with a concentration in marketing from Drexel University.
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