Well, unfortunately that’s what most people do, they just hear it from somebody else and they go and follow like sheep – bad move, because then you must be lucky to make money.
So, what’s the most important thing to ask yourself when you’re looking at a new area? And the answer to that is:
how are other investors making cash flow?
Very important question – not how are other investors are making money but how other investors are making significant cash flow.
When I talk about significant cash flow I’m talking about excessive profit every month, I’m not talking about making a $1000 or if that’s your income and then your expenses are being $950 and you’re putting $50 in your pocket every month, no, I’m talking about if your income was a $1000 your expenses should be half that so you’re making almost your expenses as profits.
That’s an exceptional cash flow deal, and there’s lots of places where you can find them but when you’re looking in a new area there might not be a standard way of doing that. There could be people doing that with serviced offices, HMO’s – Houses of Multiple Occupation, warehouses and even retail space.
So, we must analyze the market to see where the cash flow opportunity is. You know me, I’m the cash flow investor, I want to find cash flow deals and in 90% of places, it works like it works everywhere else but that doesn’t mean we should assume that that’s the best way of making cash flow in a new area.
Do your homework
When we go into a new area, we must first ask the question, what should I do here? What’s the strategy I should follow? And the only way that we can get an answer is by knowing what other people are doing to make super cash flow.
To find that out you must start talking to people, looking at all sectors of the real estate market, the more research you can do in an area, the better it’s going to be for you in the long run as an investor. The more knowledge you have about the area allows you to look at and find opportunity in the places where nobody else is looking and when nobody else is looking for stuff there are better deals available. It’s important to ask yourself these questions and always ask it even if you’ve already invested somewhere.
Ask the important questions now because you might uncover some amazing deals.