Hoffman Homes Tucson | exp Realtors | Erica Hoffman | Josh Conzemius

Build Wealth

… Erica Hoffman & Josh Conzemius, Realtors

“We love investing in Tucson property and we are going to help you do the same thing.”

The number one rule in any investing is to not lose money

Managing your risk is the key to success

Real estate investing has many avenues which one can take. Some are simple like buying a home and renting it out to eventually pay the mortgage off. And then there is the seasoned investor that will purchase a large apartment to fix up and have multiple partners. These are both ways to make money in real estate, or not. The OR NOT comes from the fact that on either end of the spectrum (simple or sophisticated), an investor must look logically at the numbers going into any of these investments. The majority of investors are do not look at the numbers logically and sadly get burned by their own emotions. The number one rule in any investing is to not lose money, so being educated and managing your risk are the keys to success.

Here are some simple ways to invest in real estate with very little risk

Buy a single family home in decent condition using a mortgage and rent it out. The yearly rent should be 10% or more of the purchase price. For instance if you buy a home for $150,000, you should expect to collect at least $1250 month or $15,000 annually. This is the absolute highest you should pay for a rental of this type. Another way to invest simply is have a guest house you can rent out while you are living at your home. Use this money to offset your mortgage or pay it down. You can also buy a four unit apartment and live in one and lease the other three. Lastly, you can lend money to someone with excellent credit to buy a property that matches the above examples. The money would be secured by the property through a deed of trust. If the person you loaned the money to fails to pay, you foreclose on the property and take it back. The laws in Arizona regarding this are in favor of the mortgage holder. These are very practical ways that don’t involve much risk at all. 

Real estate investing does not need to be risky.

As you can see, real estate investing can take on many different forms and does not need to be risky. The examples above are just a sliver of the ways one can go about in this mode of investing. The simple thing to do is get started by getting educated first and learning the way you would like to approach it with minimal risk. Flipping property sounds exciting, but it can be a real challenge if you go into it without knowing your numbers. Remember, don’t lose money in real estate. Be smart and risk adverse in the beginning. 

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