Starting your real estate investment journey can feel both thrilling and daunting, but the reality is that successful investors are made through careful planning, execution, and learning from experience. Whether you’re about to purchase your first property or looking to expand your portfolio, there are several fundamental principles to understand to set yourself up for long-term success. Before diving into real estate, let’s dive into the key factors every investor should consider.

Understanding Your Risk Appetite: Before diving in, take a moment to assess your risk tolerance. Are you comfortable with high-risk, high-reward investments, or prefer safer, more stable options? Knowing this will guide your investment choices, so be honest with yourself and what you're willing to take on.

Financing Your Investment: Do you have the necessary funds or access to financing for your first or next deal? Securing financing is crucial for getting started and growing your portfolio. It will dictate the size and timing of the investment you can make. Most importantly, being undercapitalized almost certainly leads to unnecessary stress and mistakes.

The Importance of Scale: As you expand your investments, scale leads to redundancy, and redundancy is your friend. With multiple properties, you can better absorb unexpected vacancies or maintenance costs. Many investors start with single-family homes, while seasonal investors often move to multi-family properties or other commercial real estate asset classes like retail, office, or industrial.

Cash Flow is King: Unexpected expenses and repairs are inevitable in real estate. Having reliable cash flow is crucial to covering these costs without getting overwhelmed. Always plan for the unexpected, and make sure your property generates enough income to weather financial bumps in the road.

Building a Trusted Team: Don’t go at it alone! Surround yourself with professionals who are experts in their field. This includes property managers, contractors, real estate brokers, accountants, attorneys, and commercial bankers. At Legion Properties, we have great connections and would love to serve on your team.

Knowing Your Limitations: Recognize your strengths and weaknesses. Delegate tasks outside your expertise to trusted professionals to avoid costly mistakes. Nothing will hurt more than looking in the mirror and saying, “I Told You So.”

Buying Right: the old adage is true: “You make all your money when you buy”. It's essential to purchase properties at the right price. Avoid overpaying by conducting thorough market research and due diligence. Stick to your criteria and utilize your team!