Financial Independence Through Real Estate – Part 2

March 13th, 2008 | Stacey | Financial Freedom, Financial Independence

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In the second part of our series about financial independence through real estate, we will explore types of real estate investors. There are several reasons to invest in real estate, depending on what your goals are and what you hope to accomplish financially.

The first type of real estate investors are savvy about finances, usually work with a financial planner or accountant and invest in properties for capital gains advantages. This type of sophisticated investing is a topic for later down the road, once you have established yourself as a financially independent entity with experience in real estate investing.

The second type of real estate investor is looking for cash flow. Quite simply, the investor wants to purchase property or properties that will yield an income, either by renting or selling the property. The third type of real estate investor is looking for a combination of the two.

When you start out, cash flow is the most important element and should be your focus. You need to buy a property that will not represent an immediate loss but a quick profit through rentals or a profitable sale. The property may require a bit of cosmetic work that you can do yourself to realize a profit in just a short couple of months. Working with a good real estate agent and carefully examining properties before you buy are key elements to success. Have the property inspected to make sure there are no hidden surprises that could cost you thousands of dollars after the sale occurs.

Tomorrow we will discuss the financial formulas to figure out of a property will help you attain financial independence through real estate.