Theres a reason many high-net-worth individuals still consider real estate the best investment you can make today: its a solid foundation for building wealth. If you invest wisely in one property that appreciates over time, you can use the residual income generated to acquire more properties and continue to expand your assets.

Real estate investing isnt a get-rich-quick scheme or a venture you should jump into without doing your homework but properly executed, it is a savvy strategy for creating and growing wealth. And if you are considering getting started in real estate in 2020, multifamily properties are an excellent first step into the market.

Why multifamily housing?

For years, multifamily housing has attracted the attention of investors looking for high-value, low-risk properties. The multifamily sector continues to lead as the most in-favor asset class for high-net-worth investors, according to recent data from National Real Estate Investor (NREI). A growing number of Americans are renting, due to workforce, demographic and lifestyle shifts, and those trends seem likely to continue in coming years. With occupancy rates high and vacancy rates low, now is a good time to pursue multifamily properties.

You have to be willing to put in the work and get out from behind your computer to be successful as an investor. Here are four steps you can take to lay the groundwork for your first real estate investment.

Identify your purchasing budget before you engage.

You wouldnt walk into a car dealership or even a shopping mall without first knowing how much you can spend. This step is even more critical when it comes to real estate. Study your finances carefully before looking at properties. What is the firm limit of your purchasing budget? What is a conservative range you can stay within to allow for unexpected expenses? Set realistic expectations from the beginning so you dont get in over your head on your first deal.

Get to know the neighborhood you'd like to invest in.

You need to be very familiar with an area youre thinking about buying in. What are its benefits and drawbacks? What kind of tenants are you hoping to attract? What features and amenities are most important to this audience? For example, if youre looking to rent apartments to families with small children, overall safety and public school proximity are factors to consider.

Knowing the neighborhood well also helps you estimate how far your budget will go and how long a property will take to sell or rent. Use this information to shape your overarching goal, whether that is holding onto it as a long-term investment property or flipping it to sell in a shorter period of time.

Assemble your dream team.

Real estate investing isnt a one-person operation. Youll need a reliable team of professionals who are great at what they do and with any luck, youll be able to work with them on many more projects in the future. Find the right people based on their area of expertise and the scope of work.

Research realtors who specialize in the neighborhood you want to buy in, so they can help you navigate pricing, area demographics and contract negotiations. Ask for recommendations for contractors and other trades (electrician, plumber, carpenter, HVAC technician, etc.) who can deliver outstanding results. Great workmanship is the key to getting your property rented or sold in record time. If you offer a home in pristine condition, it makes the decision for the tenant or buyer simple. So its crucial to build a crew that has an eye for detail and doesnt do quick, sloppy work, whether they are refreshing the exterior paint or doing a full gut renovation.

Weigh the benefits of hold vs. sell.

While it may sound good in theory to buy and hold real estate as investment properties, you also have to know your capabilities. Do you have the time and patience to deal with tenants? Or do you prefer to get in and out and onto the next project? Only you know your personal abilities and preferences. Take them into account as you run the numbers. What should your ideal profit margin be if you hold vs. sell? What other factors such as time, energy or other obligations do you need to factor into your decision?

Investing in real estate takes patience, time and diligence, but it can make a major difference in your financial future. Make 2020 the year you take the leap as a first-time investor.

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Get Started In Multifamily Real Estate Investment In 2020 - Forbes