With 2019 swiftly coming to an end, it’s inevitable that real estate investors are developing their investing plan for 2020 and setting their new year goals. But for individuals that are new to this venture or for those that had difficulty with their investment strategy in 2019, it may be tough to decide what to focus on or what to improve upon in the coming year. Here are some simple tips to consider as you continue to plan for the new year.
Revisit Your Investment Strategy
If there is anything a real estate investor should be doing to prepare for 2020, it should be looking back at all of the investments they made in 2019. What markets proved to be the most profitable? If you invested in different property types, which provided the best return on your investment? If you only invested in one property type, such as single-families, should you consider diversifying your portfolio and adding multis or commercial properties to the mix?
An investor should spend significant time analyzing the previous year’s transactions to determine where they had the most success and where their short comings were to ensure they have a solid plan for next year.
Research, Research, Research
As important as it is for an investor to analyze their past transactions, it’s equally important to conduct research on where the industry is headed in 2020. Markets that were good in 2019 may not be so good once 2020 rolls around. Maybe fix and flip was your go-to strategy as it provided a solid return last year, but if margins are predicted to decrease in the areas you typically invest in, it may be time to consider a fix and hold strategy instead.
Finally, make sure you’re looking for areas of the market that are expanding or predicted to expand. With the explosive growth of platforms like Airbnb and VRBO, you may want to consider investing in short-term rentals. A lot can change in a year and investors need to adapt their strategy accordingly.
Plan for the Long Term
One thing that’s certain for 2020, the housing market will continue to fluctuate. There is nothing that will better set you up for success in the new year than developing a profitable long-term real estate investment strategy. Once your strategy is set, consider connecting with a strong lending partner like RCN Capital to provide you with access to the capital you need to achieve all of your 2020 new year goals in real estate investing.
This article originally appeared on the Mortgage Professional America website. View the full article here.