If you’re wondering if you should put together a real estate portfolio, your first question might be: what is a real estate portfolio? Essentially, it’s a collection of real estate assets. Whether you’ve already dipped your toe into real estate investment opportunities or you’re starting from scratch, it’s important to embark on your journey with a clear, detailed report of your finances. After speaking with a trusted financial advisor, connect with a savvy real estate agent to educate you on the state of the market you’re looking to purchase in. Then you can consider what path you’d like to take. The BRRRR method (Buy, Rehab, Rent, Refinance, Repeat) involves renovating the property, renting it out for a period, and then refinancing it to free up more funds to purchase more properties. If you’re looking for something a little less involved, then the conventional method of purchasing a property that does not require extreme renovations and renting it out is your best bet.
The next step is deciding how much real estate you want in your portfolio. Real estate investments are an incredible way to diversify your portfolio. They provide investors with regular income, offer tax benefits, and as a tangible asset, they’ll always be worth something, even if that worth fluctuates. Diversifying your portfolio offers a certain amount of security because simply put, you’re not putting all of your eggs in one basket. So, how much real estate should you add to your portfolio? That depends on your goals, finances, and commitment level, but with a data-driven agent with decades of experience like myself ready to help you analyze the benefits and risks, we can put you on a path perfectly suited to your individual situation.
If you’re investing with the intention to fund your retirement (which you certainly should be), then consider how much time and energy you’re willing to commit to your investments. If you’re just starting out, a smaller more manageable investment, like a single-family rental home, could be a good way to explore the ins and outs of managing an investment property. More experienced investors may decide to venture into commercial real estate. It’s also important to consider other factors like the location of the property, appreciation (what is your estimated ROI?), and local market trends. Valuing properties is a critical component of the investment process, and I have the resources and tools to help you adequately do this.
As always, I welcome the opportunity to help you navigate your investment journey. With over 35 years of experience providing real estate investment analysis to my clients, I’m equipped to guide you in Washington State or serve as a trusted advisor for investment properties anywhere else across the globe. Thanks to Sotheby’s International Realty’s incredible network, the possibilities are nearly endless to connect you with extraordinary properties locally or internationally. Email me to set up an appointment to review your current portfolio and determine what your goals are so we can put together a plan for success.