Building Wealth Through Real Estate

Why Build Wealth?

This may sound like a dumb question but it is actually quite valid. Many people overlook the importance of building wealth or achieving their own financial independence. For those who have worked for someone else, it quickly becomes apparent just who you’re building wealth for. This is especially the case in budding companies whose annual growth is measured in double or even triple digits. It is the CEO, CIO or top brass that the wealth goes to while you may get a small bonus or a 2-3% raise to barely overcome the cost of inflation every year. You soon realize that all you’re doing is living paycheck to paycheck and when the day comes to hang up your hat and retire, you’re on your own. The other realization comes when one day you come across someone who is in control of their own destiny and is building their own wealth rather than someone else’s. The direct result of their hard work benefits them and not a senior manager who doesn’t even know they exist. So the answer to the question is to for you to become financially independent, improve the quality of your life and your family’s life, be in control of your own destiny and reap the rewards of your hard work.

How Can I Build Wealth?

So this is the million dollar question…pardon the pun. There are a few proven methods over time that vary by risk, luck and your own skill level or a combination of all three factors. If you are lucky enough start your own company and take it public, then you’ve got it made but the odds are certainly against you. Don’t let me discourage you but 9 out of 10 new companies fail within their first year and only a small percentage of those get venture capital funding to take it to the next level. However you may be able to work for a startup that takes off or grows steadily and eventually goes public. Those penny shares that they offered you in the beginning would then be worth a small fortune.

Another proven method is by investing in the stock market. You buy shares of a company at a specific price and as the company achieves growth over time, the stock price rises and builds the net worth your portfolio. If you invest in solid growth companies and diversify your portfolio, you have a good chance of becoming wealthy in about 7-10 years. As your portfolio grows, you can leverage it to buy large volumes of stocks and mass larger sums of wealth. The one downfall about the stock market is that there is an element of risk involved. There are economic factors at play which are beyond your control and hinder the growth of your investment. The other factor is that it is a long term investment medium which you may not see the rewards of right away.

A third proven method is investing in real estate. This in my opinion is by far the safest method and one that is almost assured to build you wealth over the mid to long term. There have been more millionaires made thru real estate than thru any other wealth building medium anywhere in the world. It is based on one simple premise. That premise is the cost of land which appreciates thru time. You cannot build more of it because there is a finite amount of it. As the demand for the land increases, so does it’s value. The world population is growing by leaps and bounds and people need places to live. As cities grow, land gets developed, the infrastructure built around it raises the value of the land a great deal because of its increased utility. The location of plot of land and the building situated on it also increase in value due to the demand.

How Can I Make Money In Real Estate?

There are many different ways of making money and investing in real estate and it all depends on your personal goals, preference and strategy. Some choose to utilize a long term growth strategy by buying single family and multi-unit properties, renting them out and letting them appreciate thru time. Others prefer to buy and sell to make a quick profit and then repeat the process over again. This strategy works on the basis of finding properties below their market value and selling them at market value for a profit. A variation of this is to buy properties and make improvements on the building or land and then sell at a higher value. This works well in areas where the cost of land is already very high like in California and New York.

The question that comes to mind is how do you find properties below market value? Well, if you’re in tune with the current happenings, you know about the soaring foreclosure market due to collapse of the short term loan market. Many investors are taking advantage of the glut in foreclosure and pre-foreclosure homes that are selling at well below market values. Another avenue for finding properties is by locating short sales. This is similar to the pre-foreclosures where a home is about to go into default and an investor will negotiate with the financial institution that holds the loan to buy the home at a discount price and avoid the foreclosure process. There are some investors that specialize in this area and are making huge profits.

Another key reason why real estate is one of the best investment medium is the power of leverage. This is where you can use someone else’s money to purchase real estate and put little or none of your own money. Yes, you can buy property without using any of your own money. You cannot acquire any type of equity (something of financial worth) in any other industry without using your own money except in real estate. Imagine that…using someone else’s money to acquire hundreds and thousands of dollars of property, make money with it and pay it back when you’re done.

Being a successful real estate investor requires the right education and training to build a strategy that you can profit from in any market. That education should come from the people actually doing it on a day to day basis and not someone selling products on an infomercial.

Written by Ather Rizvi – A Real Estate expert with 20 years experience. If you’re looking for the best education in the business go to http://www.wealth-thru-realestate.com and look into their real estate college.

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