Real estate investing can be an attractive career path and a boost to your investment portfolio. However, it can also be overwhelming with a steep learning curve, so here are ten tips to help first-time real estate investors:

1. Be certain it’s the job for you. Whether you want to take on real estate investing as a full-time job or just a part-time boost to your finances, it is a choice that requires a long-term commitment. Even hard money and private capital loan terms are typically six to twelve months, and your first few deals might not turn spectacular profits, or any profit at all. But you need to have the commitment to keep going and learn from your mistakes.
2. Be willing to make sacrifices. Owning your own business can become a 24/7 job and you may have to put in more time now to reap greater rewards (and financial freedom) later. Also, keep in mind that it might not be practical to quit your day job right away.
3. Be ready to research. You need to understand the industry as a whole as well as the niche in which you want to invest (e.g., multifamily, retail, office, warehouse).
4. Learn about your market. Before you make your first investment purchase, you need to choose an area where you want to invest and research local market data for it; this includes everything from property taxes to crime rates to business trends.
5. Network with other investors. Most experienced investors will be happy to share their success stories and tips. This process can help you find a mentor and maybe even a partner for your first deal. Lenders (even private capital or hard money lenders) will be much more willing to approve a loan for a new investor if they have a partner with more experience.
6. Know your numbers. The ability to perform basic calculations cannot be stressed enough as a key to successfully identifying the most profitable real estate deals. You also have to factor in costs beyond the purchase price and the property value. Not only could not knowing your numbers cost you money, lenders don’t like to approve loans for investors who can’t tell them how the money will be spent.
7. Get organized early. Whether you choose to invest in real estate full-time or part-time, you have to treat your real estate portfolio as a business and keep it organized with bookkeeping, marketing, and communications systems even when you’re just getting started.
8. Start small. Find ways to mitigate the risk to yourself while you’re still learning the trade. Begin with smaller property projects, or partner with a more experienced investor if you have a larger project, and build up to handling larger, more complicated projects on your own.

If you’re new to the commercial real estate investing industry and have questions about how private capital loans can be an asset to your business, Montegra can provide you with information about our myriad private capital loan programs and our lending guidelines. Contact us at 303-377-4181.