Tips for Investing in Santa Fe Real Estate
If you are first time investor in real estate, you will come to the realization that there are so many things to learn about investing in the real estate sector. Investing in real estate is much more complicated than investment on stocks due to the legal, financial and the many due diligence requirements. It is hence advised that one gets a solid education before purchasing their first investment property.
Since this is a complicated endeavor, get to familiarize yourself with the fundamentals of investing in real estate in Santa Fe. Below are the major tips for investing in real estate in Santa Fe.
- Location Matters
Before closing a real estate investment deal, it is worth ensuring that the property you are investing in is located in good and favorable location. You might consider fixing and flipping where you spot the worst house on the best street. This principle gives you the opportunity build equity. You only need to invest some good money on fixing up that worst house and then selling it to a buyer who is in need of a ready-to-move-in house in the best location.
- Search for wholesale properties
Just like investing in stock market, investing in real estate entails looking for the best deal. Consider following the Warren Buffet Principle of getting greedy amidst fears from everyone. Consider buying wholesale properties that are offered at a discount and avoid the paying the whole price for a property.
- Understand the tax benefits
Before investing in real estate in Santa Fe you should consider consulting a tax advisor about any specifics. The government offers significant tax benefits to real estate investors of Santa Fe as an incentive to invest in housing. The most significant tax benefit attached to investing in real estate in Santa Fe being the depreciation write-off. Since real estate investment is a business just like any other, you should also consider claiming the ordinary and necessary deductions claimed by other business owners such as maintenance expenses and insurance.
- Check your credit score report
It is always advisable to acquire a loan while investing in real estate rather than incurring all the cost alone. You should hence take a close look at your credit score report prior to placing your investment in real estate. Resolve any mistakes on your credit score report as quick as possible and improve on any legitimate problems.
- Adopt the 1% rule
The 1% rule state that if you are investing in an income generating property, it must produce 1% of the price you paid for it each and every month. If your plan is to buy a property that you will let to tenants whether one or more, consider using the 1% rule when deciding whether the property is worth the price you are paying for it or not.
Ensure that you are aware of what is involved in real estate investment before kicking off since not only does investing in real estate offer fabulous returns it also might end up bankrupting you. There is also no better way to learn about the market than to ask your Santa Fe real estate agent questions.