Saving your cash through 401(k)s and savings accounts are simple ways to build wealth, but the return isn’t as large as it could be with real estate investment. Owning property in nearly any city will eventually give you a large return during a sales transaction. Building your wealth, similar to the experience of Wes Edens, begins with a smart property purchase and then remaining strategic about future financial choices until the ultimate sale approaches.
Look for Class, Not “Show”
You may want the most popular apartment complex in New York City, but its quality and price tag might be too much for your personal needs and budget. Consider a low-key property with luxury and quality as the main attraction. It may not be on the busiest street, but it can turn into your own palace with time and effort.
Hold on to Your Investment
A great price on a property might tempt you to flip the real estate as soon as you can turn a profit. However, real estate almost always has more value as the years pass. You’ll pay down part of your mortgage while watching the real estate market grow in the meantime. Smart investors usually hold onto a property for 10 years or longer, allowing them to sell their property to the top bidder in time.
Build Liquid Assets
With much of your money is locked into the property, you must work hard at your profession to harness more liquid assets. Bonuses and other job-related rewards can be used to improve the property. Add a pool or renovate apartments one-by-one as vacancies come up. Choose your property updates carefully to ensure a strong return.
Don’t Overextend a Line of Credit
It’s tempting to take out a line of credit on your mortgage, but try to use other assets for any monetary needs. When you take funds from the property, you reduce your overall return when it’s sold. Only spend what you can afford and place lower priority “wants” on the back burner. When you’re patient about spending money, you’ll be able to afford all that you need (or want) in due time.
Choose the Right Real Estate Agent
When you are serious about selling, contact brokers with extensive experience in the specific location of your asset. You are paying for their expertise and networking connections, allowing you to connect with various buyers for multiple bid options. Take the time to interview several brokers until you find the right one to represent – and market – your property properly.
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