No great building is built without careful planning before the ground is broken. Blueprints and plans serve as a map for developing the building. Without blueprints and plans, the building simply wouldn’t come together. For Myrtle Beach and Grand Strand real estate investors, a carefully crafted business plan is an integral part of a real estate investment strategy. There are many options available when creating a business plan. Considering all the options sets the stage and prepares an investor for long-term success in Myrtle Beach real estate investing.
Creating a Myrtle Beach Real Estate Investment Plan
If a Myrtle Beach resident was to get into a car and take a road trip to Greenville, somewhere they’ve never been, it’s unlikely they just trust their gut and just start traveling northwest. Most likely, they’d bring a road map of sorts, whether it be a GPS or Google Maps directions.
Travelers use maps and GPS because, oftentimes, the road is unpredictable. In fact, sometimes, the seemingly right road leads to the wrong place. Other times, the seemingly wrong road leads directly to the destination. Road maps identify the easiest and most direct route, pitfalls that may be encountered, roadblocks to avoid, and unique things to see along the way.
The same principles that apply to a road trip also apply to a journey creating wealth through real estate investing. Creating a road map to follow on an investment real estate journey is vital for success. In business, it’s what’s called a business plan.
Every Investment Real Estate Business Plan Should Include:
Mission Statement. “When asked what they do, most people have a pretty clear answer. They’re a teacher or a lawyer or a doctor or a salesman or maybe retired,” says Joey Sewell a Real Estate Professional at Keller Williams The Trembley Group. “There’s no question as to what they do. A real estate investor should have an equally clear mission statement that defines their purpose and the benefits their business provides.” All Myrtle Beach, real estate investors, should do their research, consider all of their options, and devise a solid and clear mission statement. This is the “why” for investing in Myrtle Beach Real Estate.
Goals. Where does a Myrtle Beach real estate investor want to go? What does an investor hope to achieve? “If a Myrtle Beach real estate investor wants to earn $5,000 per month in passive income, they should write it down. If the goal is to flip four houses per month, they should write that down, too,” says Joey Sewell. “If a Myrtle Beach real estate investor chooses to flip houses to generate cash in order to save enough money to quit a job, they should write that down. If the investor wants to build a passive income for retirement by buying up small multifamily properties, write that down.”
“It doesn’t matter if there’s not a clear plan for accomplishing everything in the plan. There’s nothing wrong if the goals change over time,” according to Joey Sewell. It may be necessary to adjust the business plan from time to time. Goals can and will change over time. They need to be both short- and long-term. Setting modest, achievable, and clearly defined goals give Myrtle Beach real estate investors something to consistently look forward to and something that offers a sense of accomplishment as the goals are achieved. “That keeps a Myrtle Beach investor motivated,” says Joey Sewell
Strategy. There are probably hundreds of ways to get from Myrtle Beach to a Greenville destination. There’s probably an equal number of ways to make money in Myrtle Beach real estate. Most successful Myrtle Beach real estate investors only use one or two. The most successful investors choose one strategy and become its master. “A well-defined strategy – the vehicle – will carry the investor to the destination – the investor’s goals,” says Joey Sewell.
Timeline. An effective Myrtle Beach real estate investment plan will have a clearly defined timeline for reaching the goals. “A successful real estate investor will be realistic, but won’t be afraid to be ambitious, either,” says Joey Sewell. If retiring in 10 years is part of the plan or if the investor would like to resign their job in six months, it should be part of the timeline, and it should be clear and consistent with the established goals.
Market. There are many dimensions to the Myrtle Beach and Grand Strand real estate market and a real estate investor needs to define their market niche clearly. What are the target properties? Low-income? High-income? Commercial buildings? “Myrtle Beach, real estate investors, should also choose a physical area where they’re comfortable. It’s usually a good idea to start investing in properties within short driving distance of home,” says Joey Sewell. “The Myrtle Beach, real estate investor, will become an expert in the locale, giving them an edge when analyzing new opportunities.” It also helps them identify and get to know the players in the area. Ultimately, that helps an investor find business partners and more opportunities.
Criteria. “Before hitting the pavement and looking for Myrtle Beach real estate investment deals, an investor should establish strict criteria and adhere to them,” says Joey Sewell. “They should define loan-to-value, cash-flow requirements, a maximum purchase price, a maximum rehab budget, and maximum timeline, to name just a few.” One of the most important lessons a Myrtle Beach real estate investor can learn is to stick to their Myrtle Beach investment criteria and walk away from any deal that doesn’t meet them. “Becoming emotionally attached to a deal is really easy,” says Joey Sewell. “Even the most experienced Myrtle Beach real estate investor does it from time to time. But when investors always stick to their criteria, they’ll take emotion out of the picture.”
Flexibility. If a Myrtle Beach real estate investor can’t find enough deals to pick and choose, they should change their market and/or strategy. Flexible criteria is one of the most important concepts to understand and clearly define. Too many new investors get excited and buy the first deal that comes their way. By having clearly defined criteria, they are able to easily reject the 99 percent of properties that won’t end up being a good deal.
Marketing Plan. What kind of marketing system will attract motivated sellers? How does a Myrtle Beach real estate investor find the best deals? Will you use the MLS and their Keller Williams The Trembley Group Realtor, online searches, direct mail, or other means of finding deals? This is a complicated subject and will be covered in detail in a later Blog on the different marketing strategies.
Financing Deals. Few Myrtle Beach, real estate investors, have the luxury of buying properties without financing. It’s important to consider how to acquire properties. Myrtle Beach investment real estate is a very specialized area. There are conventional loans, hard money, private money, equity partners, seller financing, lease options, and other creative methods. Finding financing is often a significant challenge, especially in today’s market for Myrtle Beach investment real estate. It’s critical to find a source of funding for Grand Strand investment properties, so there’s always a steady flow of money when deals present themselves. A Myrtle Beach investment real estate specialist at Keller Williams, The Trembley Group, is an excellent source of information about the availability of funds for investment real estate.