It’s one thing to jump on one of the major online real estate sites or apps to look at beautiful properties, and amazing vistas the top properties have. It’s another thing to walk into an amazing home and think of, no dream of, living in that amazing space. And it’s a wake up call when you sit down to make an offer on the dream property and see the financial implications of how much money it will take to purchase, move into, and maintain you ideal property.

Having a financial plan for how to get, use, and transition real estate is critical in any real estate ownership. Planning and strategy are both important to successfully increase in your net worth through the purchasing, management, and sale of any real estate.

Our team advises our clients about important matters while they are making strategic financial plans regarding real estate. We enjoy the process of making and revising these plans as new ideas and opportunities come into view for our clients. Once you have a working financial plan, you will see the wide variety of properties available for you. Let us help guide you along the way as we craft a solid financial strategy regarding real estate.

Foundations

Knowing what you are building on is the beginning of a solid financial plan regarding real estate.

You may have the energy and knowledge to take care of a 5 acre piece of land with a 3,000 sqft home, a barn, and a horse arena. You may not have the downpayment to make the offer, and you may not be able to afford the monthly mortgage and maintenance required to own this big a parcel with these amenities.

If that’s your dream, or another dream that is not within reach right now, you have to take a hard look at what you own, and what you owe; what you buy, and what you are willing to not buy. Your net worth is your foundation to a successful real estate plan. How you are tied to your debts doesn’t help move you toward the dream.

Building on a debt free foundation would be perfect. Having a 6-figure salary is optimal. But if you have debt, and don’t have any money left over at the end of the month, you are starting with a less that perfect foundation.

Taking steps to eliminate debt, and to increase your monthly income will make the starting point of your real estate dream easier.

We help clients with advice on how to tackle the challenges in your foundational stage of strategy building. Starting to figure out what you have to do to get to the next chapter in your real estate story is the best first step in making that plan.

The Plan

Success in any real estate engagement requires a list of “Do’s”, and it doesn’t matter if it you first purchase or your 100th, a home or vacation rental, a small cottage or a commercial investment building. What you “Do” will determine you success. Just like driving a car or driving a golf ball, what you do or where you are looking is where you will go. Focusing on what not to do will only slightly help you do the right things to see success at the end of your plan.

What are you goals? Do you need a home for only living, or do you want to generate some income from your home through working from home, or running an Airbnb from one or more rooms? Do you want a property that will gain in value quickly by flipping it after a remodel? Do you want a property in an area of town that will see an increase in value above other areas. Are you looking to stay in place for more than 5 years, or are you thinking a move in 2 to 3 years is possible? Do you want to make this next purchase your end-all forever home?

Once you know your goals and ideal needs, you then have a place to ask a few financial questions that will help you create you to-do list.

1. How much do you need for a downpayment?
2. Do you have a  good debt to income ratio?
3. Do you know what my present monthly expenses are?
4. What will your monthly financial investment need be for your goal property?
5. Will you need money for property improvements?
6. How much money will you need when you sell your property to make your next step in your financial plan?

The next step is to ask the question, “what steps do I need to do reach my goals?” in response to each of the above questions.