10 Tips for First-Time Real Estate Investors

10 Tips for First-Time Real Estate Investors

  • Donna Brongiel
  • 04/17/23

When thinking of investing in real estate, working with professionals who know the area well, like Donna Brongiel, can help first-time investors avoid costly mistakes and provide insightful knowledge about market trends, local perks, and the industry itself. Areas like Lake Geneva and surrounding areas  in Wisconsin make great investments for their waterfront properties, luxury amenities, and high-quality living. Before planning out your purchase, review the tips for real estate investment below.

1. Set investing goals

When starting your real estate investment journey, it’s best to narrow down your goals and purpose to better focus your energy and resources. There are several different investment routes to choose from, all of which might or might not be compatible with your lifestyle and goals. For example, purchasing a short-term rental property is a great way to take advantage of seasonal interest, but requires more maintenance and marketing. Raw land is one of the most cost-effective investments, allowing investors to take advantage of a developing community.

2. Review your finances

After choosing a project that works for you, review your finances. Entering the investment scene with a tenacious financial situation can create even more problems later down the line if the investment is unsuccessful. Monitor factors like your debt-to-income ratio, your credit score, and your net worth before making an investment. Searching for other income sources can supplement investment ventures until they’re complete.

3. Know the pros and cons

As with any venture that has large gains, real estate investment can also result in large losses. Assess the pros and cons of a choice before committing to it, and make sure you can recover from an unsuccessful project. Even if an investment is yielding good amounts of passive income, other factors like rowdy tenants or the time commitment to maintaining a property may not be worth the financial gain. Be ready to commit, as getting out of an investment via a sale isn’t instantaneous.

4. Understand the market

Understanding the market is a serious asset to making a Lake Geneva real estate investment. Generally, investors should aim at buying low, as a property will appreciate in price. Monitor factors like sales prices, rate of new construction, and capital investment. Lake Geneva itself has modest levels of appreciation, although neighborhoods along Geneva Lake and Lake Como appreciate much faster. County-wide, the number of homes sales are on the decline, while median prices have increased substantially since last year.

5. Research the area

Investors should also get to know the area to make sure it’s a location that will remain a good investment. Look for particulars like school districts in the area, public transportation, and access to amenities like parks, entertainment centers, shopping malls, and restaurants. If you’re investing in a vacation property for seasonal renters, location perks will be a large draw. When planning for a long-term investment or multi-family investment, things like grocery stores and healthcare centers may be more important to residents.

Lake Geneva is the most popular for its lake by the same name, making it a great destination for investors looking for vacation renters. Downtown offers outdoor, antique, and women’s clothing shops that residents love, while the 25+ walking paths along the shore and manicured estates provide access to breathtaking nature views. Surrounded by resorts, this luxury destination offers amenities like all-inclusive spas and high-end dining as well.

6. Connect with other investors

To make a Lake Geneva real estate investment, connecting with other local investors can provide bits of insider information and valuable advice. Connections can lead to even more success in partnerships, joint ventures, or mentorships. Being open to sharing information is one of the best ways to open future opportunities and connect with people like you in the area.

7. Build a professional network

A successful investment property is the product of several professionals working together. Building a professional network early on helps investment ventures remain sustainable and profitable. For example, if you want to invest in a plot of land or a fixer upper, having a home contractor and building supply company at hand is important. To manage a rental property, having a system to keep track of customer interactions, property marketing, and bookkeeping is essential to keep things smooth.

8. Make small steps first

Going all out when you’re still new to the process can set yourself up for failure. While learning the ins and outs of the industry, consider investing in smaller properties or in lower-risk ways, like in a partnership. Efforts to succeed, such as unnecessarily upgrading a house, can also have a negative outcome. Drastically improving a property can result in a resale that’s unprofitable. Rather, observe the properties in the area and stick to functional and aesthetic changes.

9. Cultivate the right mindset

In many ways, a real estate investment is like a business venture. Although it’s important to remain practical, cultivating a mindset that regularly seeks out opportunity rather than focusing on risk or failure opens more possibilities that are profitable. Establishing an abundance mindset can greatly alter the success of your efforts.

10. Keep learning

As with any serious commitment to a job, hobby, or interests, staying fresh by taking time to learn provides additional tools in your toolbelt to use. Regularly tap into your local network to learn tips, tricks, and local real estate information. Seeking out additional knowledge in an online course or reliably sourced articles can also provide helpful information and insights.

Ready to invest in real estate?

As a first-time investor, keep the tips above in mind when starting. Being personally and financially ready helps you to commit without dire consequences, while research on the locality and market trends is important to a long-lasting investment. Many projects are best completed with help, whether that be from local investors in the area, professional service providers, or local agents like Lake Geneva Real Estate Team. When you’re ready to invest in Lake Geneva, contact Donna at 262.581.6554 to help you through it.

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