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About Marco Santarelli
I came up with the following rules of successful real estate investing over my many years of successes and failures. These are the same rules I follow today and share with our clients at Norada Real Estate Investments.
10 Rules of Successful Real Estate Investing
1. Educate Yourself
Knowledge is the new currency. Without it you are doomed to follow other people’s advice without knowing if it’s good or bad.
Knowledge will also help take you from being a “good” investor to becoming a great investor, and that knowledge will help provide a passive stream of income for you or your family.
2. Set Investment Goals
A goal is different from a wish; you may wish to be rich, but that doesn’t mean you’ve ever taken steps to make your wish come true.
Setting clear and specific investment goals becomes your road map and action plan to become financially independent. You are statistically far more likely to achieve financial independence by writing down specific and detailed goals than not doing anything at all.
Your goals can include the number of properties you need to acquire each year, the annual cash-flow they generate, the type of property, and the location of each. You may also want to set parameters on the rates of return required.
3. Never Speculate
Always invest with a long-term perspective in mind. Never speculate on quick short-term gains in appreciation, even in a heated market experiencing double-digit gains. You never know when a market will peak and it’s usually 6 to 9 months after the fact when you find out. Don’t chase after appreciation. Only invest in prudent value plays where the numbers make sense from the beginning.
4. Invest for Cash-Flow
With few rare exceptions, always buy investment property with a positive cash flow. The higher, the better. Your cash-on-cash return is directly related to the before-tax cash flow from your property.
Cash flow is the “glue” that keeps your investment together. Your equity will grow over time (through appreciation and loan amortization), while the cash flow covers the operating expenses and debt service on your property...Read the full article
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