4 Real Estate Investment Tips for Beginners

I get it, when you first think about real estate, your mind goes to big, flashy properties or giant apartment complexes. But the truth is, starting small is a smarter—and much less stressful—approach when you’re new to investing. Look for something more manageable, like a single-family home, condo, or a small rental unit.

Why? Because starting small allows you to:

– Learn as you go without biting off more than you can chew.

– Make mistakes (and trust me, you will make a few!) without putting too much of your money on the line.

– Build your confidence, knowing that you can take on bigger projects down the road.

I’ve worked on several condo projects and recommend them as a good way to get started–you just need to make sure that the condo association dues aren’t too high because high monthly payments for dues can eat into your real estate funds quickly. The reason I think condos are a good idea is because they are a great way to limit your potential risks of expensive repairs. After all, the association is typically responsible for roofs and exterior walls.

The cash flow you’ll get from a condo may not be as high as what you might earn from single-family homes, but if you can find good deals , condos are a great way to start. Your first win, even if it’s small, will give you the momentum to keep going. The important thing is just to start.

Negotiate Wisely Using Comparable Sales

When I bought my first property, I knew I had to get the price right if I wanted to make a profit down the road. One of the best ways to negotiate a great deal is to know your numbers—this is where **comparable sales (comps)** come in. By researching recent sales of similar homes in the same area, you’ll have solid data to back up your offer.

Here’s how you can use comps to your advantage:

– Do your homework: Check out homes that have recently sold and see what they went for. You want properties that match your target in size, condition, and location.

– Look at market trends: Are homes selling above or below asking price? Is the neighborhood hot or cooling off?

– Back up your offer: When you negotiate, mention those comparable sales to justify your price. It shows you’ve done your research and aren’t just throwing numbers around.

Real estate agents can help you learn more about your local markets and can prepare a CMA (comparative market analysis) and tell you about market conditions. These are a great resource, but you should also know how to do a bit of research on your own using online platforms.

?By the way, speaking about real estate agents.. if you have one that you like, ask them if they handle property management. You can see how much they charge to manage rental property, and then determine if you would like to have a property manager or if you prefer to manage your own residential properties. There’s no right way when it comes to this, it just depends on each individual investors comfort level with handling leases and tenant relations. We can go through this in more detail with future posts and information.

Negotiating smartly is one of the most important ways to protect your bottom line and get the best real estate deal possible.

Use Leverage to Expand Your Portfolio: The key to getting started with real estate investing

Let’s talk about one of the most powerful tools in real estate investing—leverage. This simply means using borrowed money (like a mortgage) to help you control a large asset with a smaller amount of cash upfront. In other words, you don’t need to pay for the whole property out of pocket. You just pay the down payment (and then the mortgage payments monthly). This often the biggest key to getting started with real estate investing.

Why leverage works:

– You can control more real estate for less money.

– As your property appreciates in value, your return on investment (ROI) increases significantly, even though you only put a small portion down.

– Over time, you can tap into the equity in your first property to buy additional properties, growing your portfolio faster.

Just remember, with leverage comes responsibility. Make sure you can handle the loan payments, property maintenance, and any vacancies that might come your way. But if you manage it well, leverage can really accelerate your growth.

Be sure that you find the right property and that your rental income covers the mortgage payments and you’ll be off to a great start. After all, over time the rental rates should increase to a higher price but your mortgage payment should stay the same (assuming your loan has a fixed mortgage interest rate). This makes leverage a great tool to use with a long-term investment that can provide steady income and lead to financial independence. 

Save Money by Tackling Simple Renovations Yourself

One of my favorite things about real estate is the power of DIY renovations. You don’t have to be an expert contractor to make a property more valuable. There are plenty of small, easy projects you can take on yourself to boost a home’s appeal and its price tag. And the best part? You’ll save thousands in labor costs!

Here are a few ways you can get started:

– Bathroom refresh: Add a new coat of paint, some fresh wallpaper, or updated decor. You’ll completely transform a tired bathroom without breaking the bank. You can view one as an example here.

– Curb appeal: The first thing buyers notice is the outside of the home. Simple updates like a freshly painted front door, clean landscaping, or new house numbers can make a big impact.

– Lighting updates: Swap out old light fixtures for modern ones. This is a quick and inexpensive way to brighten up a space and make it feel brand new. (Here are some inexpensive go-to options that I use all the time from Amazon)

Small, budget-friendly upgrades like these can make a huge difference when it comes to renting or selling your property. And they’re a lot easier than they seem!

Ready to Begin? Getting started with real estate investing:

Are you excited about getting started with real estate investing but feeling a little unsure about where to begin? I hope these tips give you the confidence to take that first step. Remember, you don’t have to tackle everything at once. Start small. Learn as you go, and before you know it, you’ll be on your way to building a portfolio you can be proud of.

Want more tips like these? Follow me on Instagram where I share regular insights on real estate, DIY projects, and wealth-building. And if you’re serious about getting started with real estate investing, sign up for my newsletter. This will give you get step-by-step advice straight to your inbox. If you have specific questions, just email me. I’ll do my best to create a post with the answers. Because really, if you have a question it’s likely others are wondering about the same thing.

I hope that you’ll start your path to investment properties. The world of real estate investing is a wonderful one that allows property owners to earn regular income. I strive to provide a great place for new investors to feel comfortable learning about the real estate industry and start meeting their financial goals.