While a short-term profit may be your intentions, always plan to hold real estate for the long-term.
Why you ask? Because a quick sale may not be what the market has in store. During the real estate bubble of 2007-2008, thousands of "so-called" investors acquired properties with the goal of holding short-term. While this worked for a time (prior to the real estate crash), the downturn caught many by surprise. No longer were their properties worth what they were before. In fact, prices fell so rapidly that many found themselves owing more than the property was worth.
So what happened next... ? Well, these short-term investors were short-term alright... they foreclosed on their properties, and the banks repossessed their homes.
So what can we learn from this?
Plan on holding your investment property for the long-term... even if you have short-term intentions! Holding a property long-term forces you to focus your investment decision on cash-flow, rather than potential profits from appreciation. While appreciation is very beneficial, positive cash flow is key to sustainability in real estate.
Cash flow isn't a complicated topic. It's simply the difference between how much your property costs to own and how much cash it generates each month. If your property costs $1,000 but brings in $1,200, you have a positive cash flow of $200. This is a sustainable situation. Not only is your property paying for itself (mortgage, taxes & insurance), but it's also paying you an extra $200 per month. No matter what the market does, you should be able to sustain.
However, if your property costs $1,000 but only brings in $500 each month, you have a negative ฝากขายที่ดิน cash-flow situation. In other words, to hold the property it costs you $500 each month. This is where investors get themselves into trouble. If the real estate market slumps, you're stuck with a lose/lose situation. Not only is your home worth less than you bought it for, but you're also locked into paying $500 each month to hold on to it.
As a investor, you must hope for the best, but plan for the worst. A positive cash-flow will allow you to acquire numerous properties, flip them for appreciation profits, or hold them long-term if need be. Positive cash-flow creates a sustainable investment. It also maximizes your chances for making great money in real estate.
So no matter your intentions... start by thinking long-term. Start with a positive cash-flow.
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