Real estate investing often leads to early retirement and is always one of the reasons people want to get involved. That being said, quitting your day job to become a full-time real estate investor is not an easy decision. This is a major move and you must weigh all the options before making the final decision.
Here are some ways you can know it’s time to leave your 9 to 5 job and focus entirely on real estate investing:
When you understand the fundamentals of real estate investing
Owning property will not automatically make you a successful real estate investor. You need to have sufficient knowledge and understanding of the real estate industry. Learn as much as you can about real estate trends, types of property, mortgage, property management, investment strategies, Airbnb laws and property tax. You can sign up for real estate courses, read real estate blogs or watch YouTube videos. It would also be advisable to attend local events where real estate professionals meet.
When you’ve saved up enough
Real estate investing is a very capital-intensive venture. According to the Canadian Real Estate Association (CREA), the average home price in Canada was about $688,000 in May 2021. This was a 38.4% increase from the same month last year. If a lender requires a down payment of 20%, you will have to put down more than $135,000. Before quitting your job, make sure you have enough cash saved to cover your living expenses for several months as well as pay the costs associated to your business.
When you have enough properties generating a positive ROI
A positive cash flow means that the income generated exceeds the costs associated with the property. You are ready to leave your day job when the profit from your investment properties is higher than your salary. Owning positive cash flow properties is the way to becoming financially independent as a real estate investor.
When you’ve built a strong real estate network
Real estate investing is not a one-man show. You will need to build relationships with professionals like general contractors, listing agents, attorneys, accountants, project managers, insurance agents, and successful investors. Such people will provide valuable advice concerning different aspects of real estate investing. With a strong network, you will be able to leverage and grow your business in the long term.
Conclusion
When you do your homework, quitting your day job to pursue a full-time career in real estate investing will be less scary. If you need help getting started with investing in real estate, get in touch with us: