How to start investing in preconstruction?
Through our website, the most common question we receive is “How do I quickly start investing in preconstruction?” Realistically, you only need to take three steps on your way to being a “beginner”
pre-construction investor to one who is extremely smart.
MECHANICS OF INVESTMENT IN PRECONSTRUCTION
Before I even started
investing, you need a working knowledge of exactly what it means
for investment in “pre-construction”, why pre-construction
the investment generated returns greater than 100% per year for many
investors, what is the terminology used in actual preconstruction
real estate investments, etc. The good news is that this is the easiest way.
step to take
As an example, at this stage you will learn terms such as
reservation, hard contract, transfer of contract, letter of
credit, to name a few. Even if you are new to investing, don’t
let that intimidate you. Every time I teach a class on this topic,
it only takes 30-60 minutes for everyone to get up
speed on this.
So how do you learn the mechanics of being a pre-build?
real estate investors? My suggestion is to take advantage of the
Free resources available on the Internet. for example in
GetPreConstructionDeals.com gives you a 30 page e-book on
preconstruction investment that will guide you through this basic
terminology and will give you some real-world preconstruction
examples of real estate projects. Also, if you make an Internet connection
search in “preconstruction” “investment in preconstruction”
“preconstruction condo” etc you will find tons of websites
with this kind of information readily available. give yourself
a night or two and you should be a teacher. Unfortunately,
over 80% of new investors stop after Step 1 and immediately want
to search for “deals”. In my opinion, this is a big mistake.
because they lack what separates the beginner investor
from the seasoned pre-construction investor on the street; tea
methodology to choose QUICKLY “smart investments”
FIND PRECONSTRUCTION PROJECTS
If you did an internet search
in Step 1 above, did you notice how many real estate websites
What did you find with the preconstruction investments in them? No,
just put the term “miami preconstruction” on any internet
search engine and you will see the number of results. here’s a
test for you. From the Internet searches you have done above, can you
take a quick look at those projects and choose what they could be
worthy of further investigation? Most people feel overwhelmed
at this point, while most savvy investors might classify
most of these in a matter of minutes.
Over the years, both in the stock market and in real estate, I have
I have had the opportunity to work with some really outstanding
investors and I have also seen many, many beginners. When a
beginner looks at a preconstruction investment, they ask the
real estate person “How much am I likely to make in this
investment and should I buy it?” When an experienced investor
look at the same investment, they first ask THEMSELVES “Is this
very low risk investment and, if so, how much money is it really
at risk?” Then they ask THEMSELVES “How much money am I going to
do if this investment works?” In his mind, they are
trying to determine the amount of reward, relative to the risk.
They know that the person marketing this project is unlikely to
think this way, but they know how to ask the right questions to
quickly decide if this project has an acceptable risk/reward ratio
proportion to THEMSELVES.
If you are reasonably new to investing, or have always counted
in others to make investment decisions for you, how do you
perform step 2? Easy. You must learn how a smart investor
think, how do they calculate risk, what backup plans do they have in
place in case the investment does not work out, how do they calculate
reward, etc. None of this is rocket science or even difficult to
do. If you are new to preconstruction investing and are trying to
doing all of this on your own, however, can be a daunting task. me
discover that truly smart investors are always talking to others,
getting their opinions, learning all they can to make YOUR
Own decision. They know that every little detail they can learn
can literally mean several 10’s of thousands of dollars in
their own pockets.
In practice, you need someone to guide you who has “been in
dance” many times before. If you meet someone at that
category, buy them lunch, dinner, movie tickets, whatever and
ask them if they would look over your shoulder. if you know several
people in this category, even better. Your lunch bills will be
expensive, but your acquired education will be priceless.
Plus, learn to think like a preconstruction expert
investor is the reason we created our original home studio
as well as our most comprehensive live teleseminar course.
Many people have no one to turn to other than perhaps the
real estate person taking them the project. I personally find
that most real estate agents/brokers are fantastic resources for
information, however most do not analyze the investment as I do
would do. If you ever find yourself asking your agent or
seller if he “really thinks you should buy this”, then
that’s probably a good indication that he’s not prepared.
No matter how you do it, learn to think like an expert
investor for YOURSELF; it’s just not that hard to do.
GROWING YOUR PORTFOLIO
Once you think like a pro in Step 2,
you will have created a problem for yourself: probably
discover that few preconstruction projects will fit your goals.
New investors tend to think of this as the stock market…
When they are ready to invest, you should be able to invest
put your money down and move on. Realistically, in stock
and the pre-construction market, TRUE OPPORTUNITIES appear
when they are good and ready. When that happens, and only then
time, then the smart investor will jump at lightning speed.
Remember, for many people, a couple of good investments PER YEAR
is a lot and can then more returns on investment than ever
possible.
While this may be hard to imagine at this point, after step 2,
must have a clear understanding of the type of investments
what would you consider As an example, suppose you end
concluding that you really like condo/townhouse projects, not in
the beach, and in the southeast. Plus you want these
investments in some emerging markets, but not necessarily in those
that have been explosive for a long time. Excellent! start now
get into broker/developer lists that bring those
projects. If you can work with a group of like-minded people,
all the better because you can share the workload and also have
additional leverage due to higher potential purchasing power than
just one individual.
However, I warn you that when you think like an expert
investor, you will want much more information than you
typically provided by these types of sources. you will want a
true assessment of the local market (other than “boy has this
hot state”), you’ll want a real assessment of the amount of
similar projects that have been offered or will be offered, and
you’re going to want to know a lot about who’s buying these
projects and why.
Because we really like detail and because we know we have to
move very fast for good investments, we have always found it
It is better to operate as a group, rather than one person trying
to fix this after work. Furthermore, we have found that by
pooling the purchasing power of a group we can get a lot
better access to really good investments.
It is for these reasons that we at GetPreConstructionDeals.com
We have created our “Mastermind Group”. I hope this has given you
an understanding of the 3 steps needed to become a reality
preconstruction investor. Some people will see this and say
that is too difficult or requires too much time. yes it will take
some time and some effort. The question I always ask
is then “How many hours at your regular job would it take you
make some of the great $75,000+ returns that some
What are preconstruction investors doing?
