buying your first rental property

How To Be Thankful And Buy Your First Rental Property

Posted by neil on April 24, 2013
General / No Comments

Hi Friend,

I hope you are doing well.

Yesterday I received an email from a blog reader.

In the email, the reader provided some feedback as to why they had unsubscribed from  the First Rental Property blog.

With a blog readership in the thousands, I get messages from people all the time that have chosen to unsubscribe.  This is just the nature of having a blog with a large readership.

Some of the common reasons that I get from people who have chosen to unsubscribe are listed below:

  • I am no longer interested (in general)
  • I am no longer interested in buying a rental property
  • I am getting too many emails
  • No reason stated

These are the standard reasons as to whey people unsubscribe and I hear them all the time.

However, the most recent explanation that a reader gave me, struck a cord with me.

The reason they had stated, as to why they unsubscribed from First Rental Property was because:

  • They wanted more VALUABLE information
At first, I thought to myself, “Oh man! Are the subjects that I write about on the blog not valuable?  Do the subjects not benefit new real estate investors who want to purchase their first rental property?”
After I had some time to ‘digest’ the former subscriber’s comment, I quickly realized once again that the content on the blog is valuable.
However, the thought process that this former reader experiences (no disrespect former reader) is very common with a lot of people who are trying to buy their first rental property.
If you are a new reader to the First Rental Property blog, you should know that most people who are interested in buying a rental property never do so.
One of the main reasons why I believe this to be the case is because people are not thankful in general.
Let me explain.
The prospective real estate investors who never end up taking action and buying their first rental property, seek out as much information as possible regarding real estate investing but yet they never:
LISTEN.
When you are a new real estate investor and you are trying to navigate your way to become a successful real estate investor, you need to listen.  You need to listen carefully to experienced real estate investors.  When experienced real estate investors give advice, for the most part, they know what they are talking about!  Because they have been through what you are trying to accomplish yourself (buying a rental property) there is a lot that you can learn from them.
So the lesson to be learned here is, LISTEN.   Once you have listened to the veteran investors, then in turn please be thankful for their expert advice.  If you show gratitude there is a good chance that you will receive MORE valuable information from the experienced real estate investor.  If you are ungrateful and do not show your appreciation for the information that they have given you, there is a good chance that the valuable advice that you were getting from them will stop.
Another big way in which you can be thankful and show your gratitude is to:
IMPLEMENT
If you implement the advice that an experienced real estate investor has been giving you, there is a high probability that you will continue to get valuable information from the veteran investor.  If you show that you are an action taker and that you are willing to listen and take action, you will get more support from the experienced investor.
On the flip side…
…If you continually seek information on real estate investing, and you never take any action toward buying your first rental property, your free information from that experienced individual will soon ‘dry up’.
The free info will be gone because providing non stop valuable information to a novice real estate investor is an energy sucking tasks for a lot of experienced investors.  It becomes energy sucking when the experienced investor realizes that the novice is not listening to a word of their advice and not implementing anything that they are saying.
My biggest advice to you if you are in the market to buy your first rental property is to simply LISTEN to and IMPLEMENT was experienced real estate investors are telling you.
In addition, if you show them gratitude and you show them that you are thankful for all of the information that they are providing you with, you are going to continue to get more information from them.
If you are ungrateful and you don’t listen to or implement what they are advising you on, they are not going to help you for much longer.
LISTEN.  IMPLEMENT.  INVEST.
Happy Investing!
Neil Uttamsingh
ps: If you are a new reader to the First Rental Property blog, sign up for the newsletter by entering your name and email into the top right hand corner of the blog.  In the newsletter, experienced real estate investors will share with you tips and tricks on how to buy your first rental property!

 

 

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How To Calculate ROI

Posted by neil on April 18, 2013
General / No Comments

Hi Friend,

I hope you are doing well.

If you are new to real estate investing, chances are you do not know how to calculate ROI (Return on Investment).

For many new investors, the topic of ROI is a confusing one and many people do not understand it.

If you are serious about buying your first rental property, and you think that you are going to purchase multiple rental properties, at some point, you need to understand ROI and become comfortable with calculating it.

So what are the reasons you need to know how to calculate ROI?

Reason #1 – Is the investment good or bad?

One of the major reasons you need to know how to calculate ROI is to know weather an investment is good or bad.  If you do not know how to calculate ROI, you will not be able to differentiate when you see a good investment, or when you see a sub par investment.

Reason #2 – Protect Yourself

Another major reason as to why you need to know how to calculate ROI is so that you can protect yourself.  You can protect yourself in that, if an investment is presented to you, and the ROI is stated, you will be able to double check the numbers and determine if the ROI is in fact the same as what is being presented.

At the end of the day, ROI is not hard to calculate.  It is comprised of 3 components.

Component #1 – The money you are investing.

When calculating ROI, you need to first take a look at the money you are investing.

If we are look at an example, let’s say that you are investing $100,000.

Now that you know how much money you are investing, you now need to look at component number 2.

Component #2 – How much money you are making.

With real estate investing, the money you make can come in different forms. It can come in the form of cash flow, mortgage paydown or appreciation.  In this example we are going to keep things simple.

Let’s say that they money that you made on your $100,000 investment was $14,000.

Now that you know how much money you invested, and how much money you made you need to look at component number 3.

Component # 3 – Time Period

When calculating ROI, you always want to take a look at the time frame.

For example, using the numbers above, let’s say that they money you made ($14,000) on your initial investment of ($100,000) was done in one year.

Therefore, when you are calculating your ROI, it would look like this…

$14,000 (money you made) / $100,000 (initial investment) = 14% in year one

As you can see from above, if you invested $100,000 into rental property and made $14,000 (with cash flow, mortgage paydown and/or appreciation) in the first year, your ROI when calculated would be 14%.

This is a simple explanation of how to calculate ROI.  Simple is good because most novice real estate investors do not know how to calculate ROI.  You need to have a basic understanding of it, and the explanation above gives you just that!

So what do you think?  Is calculating ROI is harder or easier than you thought?  Leave your comments below.

Happy Investing!

Regards,

Neil Uttamsingh

ps: If you are serious about buying your first rental property, sign up for the First Rental Property Newsletter.  All you need to do is fill out the form located at the top right hand corner of the blog.  When you do this, you will start to receive tips and tricks from experienced real estate investors on how to buy your first rental property!

 

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