Three Things to Consider to Make a Great Investment

real-estate

Anyone who is considering investing in real estate probably wants to profit from it. The end goal of real estate investing is to make money on each deal, which results in creating wealth. Another goal of real estate investors is to spend as little time as possible tending to the properties in which they invest. Here are some goals to set so you will achieve the optimal end game in real estate investing.

 

Minimal Risk Investing

While real estate investing provides highly profitable wealth creation, it is exceedingly risky when you don’t understand the types of property investing available to you. For instance, private real estate funds, land, TIC (Tenant-In-Common) investments, fixer-upper houses, and the like come with a higher risk than buying a well-established, cash flow type investment property.

It isn’t uncommon to reap little to no return on your investment with the riskier types of real estate. If you do reap any profits, they are usually too low to account for the time, effort, and money you put into them. There are simply too many things that can go awry with risky property investments. Reduce the risk in property investing by performing due diligence, research, analysis, testing, reviews, and reliable professional property advice.

 

Fair Cash-on-Cash Return Investing

When you invest in property, you are taking money from your fluid form of financial assets and putting into an extremely illiquid asset; real estate. Fluid forms of assets include a traditional bank account, savings, stocks, CDs, bonds, and such. In the case where you are taking fluid assets that are earning interest (CDs, stocks, bonds, etc.), your goal should be to aim for the fair cash-on-cash return concept.

How can you accomplish this? Pro forma (calculate present and future financial returns) your real estate deals and invest in cash flow positive property for a better ROI (return on investment). Avoid properties that are negative in nature, like high-risk or high-maintenance properties, even if they seem to be “prime”.

 

Low-Maintenance Property Investing

Sometimes, cheaper property will seem appealing, but be careful of these properties. Beware of fixer-uppers, “needs a little TLC” properties, and real estate that will require a lot of management and a lot of your time. Maintenance companies are expensive. Examples of high-maintenance properties include cheap houses in atrocious areas, vacation rentals, college rentals, and other like real estate.

Stick to basic and boring real estate that requires little of your time, needs less management, and that can be rented for long periods of time to tenants with proper credit profiles. Idyllic tenants don’t require babysitting, but remember to treat them with respect and build a favorable relationship with them. That way, as issues arise (and they will), there will be fewer hassles when addressing them.

Overall, the best real estate investment still remains in the old standbys –  boring, totally-owned, in satisfactory condition, cash-flow positive properties. These properties are available to you, but you won’t often find them on MLS listing all the time. You will need to do some foot work, some research, reading, and due diligence to find and accrue the best real estate investments.

Success Depends on Your Investment in Your Employees

Good management practices make a business successful and are direct reflections of your company’s culture. Investing in your employees is part of good management. Here are some facts and ideals that back up this concept.

CareerBuilder and Gallup reported that 70 percent of American workers are often uninspired and/or disengaged at work. Furthermore, the reports state that this caused losses of more than $450 million across business industries in 2013 alone.

Why do people feel disengaged or uninspired at work? Lack of support, feeling over-scrutinized or micro-managed, and the feeling that there is no job security all create the disengaged and uninspired thought processes.

Negative Vs Positive Workplace Environments

  • Negative – The workplace environment that creates this negative vibe will breed high-stress situations, which cause lack of focus in employees. Therefore, they turn to personal tasks at work like social media, chat, gaming, texting, and emailing.
  • Positive – The workplace environment that creates a positive vibe makes employees feel supported and empowered so they are very productive and do their best at work. They are focused and loyal to the company, making your business more successful and sustainable.

Create a Positive Company Culture

At one time, company culture wasn’t a thing. Few businesses would have considered supporting and investing in their employees in the rough and tumble world of business. Nowadays, recruiting new employees requires that they know your company culture.

The goal of creating a positive company culture is to see your employees coming into work with smiles on their faces that show you they are happy to be there and that they can’t wait to come into work. Zeal and enthusiasm is bred from a positive, supportive, employee-empowering company culture.

Creating this positive environment requires that you invest in your employees. How does that work?

  • Offer bonuses for performance and holidays
  • Offer perks like in-house promotions and training, paid training, tuition reimbursement, and help with furthering their career in your company.

Brainstorm from these ideas and come up with effective and viable ways to invest in your employees.

 

The Benefits of a Positive Company Culture

  • Workplace morale gets better when management knows how to reduce low morale problems to create a positive, supportive, and high-energy workplace.
  • Employee retention is a huge benefit of the positive company culture. Employees who enjoy their jobs will stay and grow with you.
  • Employee loyalty is crucial to a successful business. Loyal employees are engaged and productive in a supportive environment.
  • Company reputation is boosted when you have a positive company culture. You will attract better employees who are productive and excited to work for you.

What you do to create a positive company culture within your company is ultimately up to you. This information merely provides a few guidelines to help you come up with ways to make your workplace desirable to good employees. Invest in your employees in various ways to build a team that is creative, positive, happy, engaged, and productive. Continue to grow and thrive by implementing new ways to invest in them throughout the lifespan of your company.