The Long Term Benefits Of Owning Real Estate- Part I

     I think my favorite thing about owning real estate so far is most certainly the long term stability that it has brought to my life. The cash flow which has helped me progress towards financial freedom. I mean who doesn't appreciate being rewarded for taking a chance & investing into something, where the outcome is income. My name is George Mevawala, and I have had the privilege of investing in over a dozen properties so far since beginning my journey of investing in real estate. I am both a realtor and investor, and my favorite thing so far has been educating my client's that choose to work with me of the long term benefits of owning real estate.

     I think the main reason why most people become hesitant about the thought of taking the plunge into buying a property is the uncertainty. The uncertainty that they will not either be able to make their mortgage payment, or the uncertainty that they will not be able to cash flow positive on a property, or the uncertainty that the market will crash or pull back right when they purchase their property. These are all common and very rational thoughts for a first time buyer, but nothing brings me more joy than helping them understand the long term benefits of owning real estate.

     I remember like it was yesterday purchasing my first property. I was 22 years old and nothing brought me more joy then getting the keys to my first home. Rookie mistake, I forgot to get the power switched over into my name, but I was just so excited that I stayed the night at the property with nothing but a mattress on the floor and a bunch of candles light up around it.. I think it was the rush of knowing that I was finally a homeowner mixed with the pride that I actually was able to accomplish this. I went on to live in that property for several years and it helped open doors to me being able to acquire several more properties in the following years.

    I was able to capitalize on the appreciation that I gained from buying the property mixed with the discipline of financing the property on a 15 year mortgage to maximize my return. I encourage that every person no matter if they are a 22 years old or 52 years old to educate themselves on the importance of buying a property. Having a property is not only a piece of who you are, but it is also your legacy.  Once you are sitting on some equity in a property, you can unlock that treasure chest to put it to work on obtaining other properties. I know what some are saying, not everybody is going to buy at the right time. But as I explain to everybody, the right time is always now. There is a deal out there no matter how the economy is doing.

     Whether it be a value add starter single family home where you plan to have your buddies help you partially upgrade it to same some money, or that duplex that you've noticed down the street from you that has been sitting empty for six months and the weeds are starting to grow over 3 feet high in the front yard, the power is in your research and taking a chance. NOW, I am not saying to go out there and buy that beautiful turn key 2 bedroom condo in that new high rise with the $800 a month HOA dues...I stay away from the new builds in the buildings trading for outrageous pricing per square foot right when released to the market, but the value in real estate is in the buy. This is when you get to let your inner art out and design this property however you would like and this adds value. 

     This is my strategy for roughly 90% of my investments. I think we all like to be creative, but if you are given the opportunity to acquire an asset under market value that does not look pretty inside, this is possibly an opportunity for you to make some money. ( You need to run the comps or have a licensed and credible real estate agent help you determine what the property is worth before jumping the gun on acquiring a property, but start looking around your town and online to see what you can find). You will be amazed at how many hidden gems exist out there, and the more you start to look into it, the more opportunities that will be presented your way. There is nothing like walking the property of a fix up opportunity, and start brainstorming your budget and let your design ideas flow.

If it all cannot be done, then you can complete the remodel in phases. Maybe start with the most important items such as the kitchen and bathrooms, and work your way to all the other items once you have a solid year of cash flow. Once you complete this first value add project, you will be on your way to the path of financial freedom.