How to start investing in preconstruction?

Through our website, the most common question we receive is “How do I quickly start investing in preconstruction?”. Realistically, you only need to take three steps on your path to be a “beginner”

preconstruction investor to one who is extremely smart.

MECHANICS OF INVESTMENT IN PRECONSTRUCTION

even before you start

investing, you need a working knowledge of what exactly it means

for the investment in “preconstruction”, why preconstruction

the investment generated returns in excess of 100% per year for many

investors, what is the terminology used in actual preconstruction

real estate investments, etc. The good news is that this is the easiest way.

step to give

As an example, in this stage you will learn terms such as

reservation, hard contract, assignment of contract, letter of

credit, to name a few. Even if you’re new to investing, don’t

let that intimidate you. Every time I teach a class on this topic,

it only takes 30-60 minutes for everyone to get up

speed on this.

So how do you learn the mechanics of being a pre-build?

real estate investors? My suggestion is to take advantage of the

Free resources available on the Internet. for example in

GetPreConstructionDeals.com gives you a 30 page eBook on

preconstruction investment that will walk you through this basic

terminology and will give you some preconstruction of the real world

Examples of real estate projects. Also, if you make an Internet connection

search in “preconstruction” “investment in preconstruction”

“preconstruction condo” etc. you will find tons of websites

with this type of information readily available. give yourself

a night or two and you should be a master. Unfortunately,

over 80% of new investors stop after Step 1 and immediately want to

to search for “deals”. In my opinion, this is a big mistake.

because they lack what separates the beginning investor

from the seasoned preconstruction investor on the street; tea

methodology to QUICKLY choose “smart investments”

FIND PRECONSTRUCTION PROJECTS

If you did an internet search

In Step 1 above, did you notice how many real estate websites

What did you find with the preconstruction investments in them? But,

just put the term “miami preconstruction” on any internet

search engine and you will see the number of results. here is a

test for you. From your previous internet searches, can you

quickly look at those projects and choose what they might be

worthy of further investigation? Most people feel overwhelmed

at this point, while most savvy investors could classify

most of these in a matter of minutes.

Over the years, in both the stock and real estate markets, I have

I have had the opportunity to work with some really outstanding

investors and I’ve also seen many, many beginners. When a

beginner looks at a preconstruction investment, they ask the

real estate person “How much am I likely to make on this

investment and should I buy it?” When an experienced investor

look at the same inversion, they first ask THEMSELVES “Is this

very low risk investment and if so how much money is it really

at risk?” Then they ask THEMSELVES “How much money am I going to

do if this investment works?” In his mind, they are

trying to determine the amount of reward, relative to risk.

They know that the person marketing this project is unlikely to

they think this way, but they know how to ask the right questions to

decide quickly if this project has an acceptable risk/reward ratio

proportion to THEMSELVES.

If you are reasonably new to investing, or have always counted

in others to make investment decisions for you, how

do step 2? Simple. You must learn how a smart investor

think, how do they calculate risk, what backup plans do they have in

place in case the investment does not work out, how do they calculate

reward, etc. None of this is rocket science or even hard to

do. If you are new to preconstruction investing and trying to

Doing all this on your own, however, can be a daunting task. Yo

discover that truly smart investors are always talking to others,

getting their opinions, learning everything they can to make THEIR

Own decision. They know every little detail they can learn

can literally mean several 10’s of thousands of dollars in

their own pockets.

In practice, you need someone to guide you who has “been in

the dance” many times before. If you know someone in that

category, buy them lunch, dinner, movie tickets, whatever and

ask them if they would look over your shoulder. if you know several

people in this category, even better. Your lunch bills will be

expensive, but your acquired education will be priceless.

Plus, learning to think like a preconstruction expert

investor is the reason we created our original home studio

as well as our most comprehensive live teleseminar course.

Many people have no one to turn to other than maybe the

real estate person bringing the project to them. I personally find

that most real estate agents/brokers are fantastic resources for

information, however most do not analyze the investment like me

would do. If you ever find yourself asking your agent or

seller if he “really thinks you should buy this” then

that’s probably a good indication that you’re not ready.

No matter how you do it, learn to think like an expert

investor for YOURSELF; it’s just not that hard to do.

GROWING YOUR PORTFOLIO

Once you think like a pro in Step 2,

you will have created a problem for yourself: probably

find that few preconstruction projects will fit your goals.

New investors tend to think this is like the stock market…

When they are ready to invest, you should be able to invest

Put your money down and move on. Realistically in stock

and the preconstruction market, REAL OPPORTUNITIES appear

when they are good and ready. When that happens, and only in that

time, then the savvy investor will jump in at lightning speeds.

Remember, for many people, a couple of good investments PER YEAR

is a lot and can then more investment returns than ever

possible.

While this may be hard to imagine right now, after step 2,

must have a clear understanding of the type of investments

what would you consider As an example, suppose you end

concluding that he really likes condo/townhouse projects, not in

the beach, and in the southeast. Also, you want these

investments in some emerging markets, but not necessarily in those

which have been explosive for a long time. Excellent! now start

get on lists of brokers/developers that bring out those

projects If you can work with a group of like-minded people,

all the better because you can share the workload and also have

additional leverage due to greater potential purchasing power than

just one individual.

However, I warn you that when you think like an expert

investor, you are going to want a lot more information than you

typically provided by these types of sources. you will want a

true assessment of the local market (other than “boy does this have

hot state”), you will want a true assessment of the amount of

similar projects that have been offered or will be offered, and

you are going to want to know a lot about who is buying these

projects and why.

Because we really like detail and because we know we have to

move very fast for good investments, we have always found it

It is better to operate as a group, rather than as one person trying to

to fix this after work. Furthermore, we have found that

pooling the purchasing power of a group we can get a lot

better access to really good investments.

It is for these reasons that we at GetPreConstructionDeals.com

We have created our “Mastermind Group”. I hope this has given you

an understanding of the 3 steps needed to become a reality

preconstruction investor. Some people will see this and say

that it is too difficult or takes too long. yes it will take

some time and some effort. The question I always ask

is then “How many hours at your regular job would it take

make some of the big returns of over $75,000 that some

What are preconstruction investors doing?