Real Estate Investing for Beginners: 5 Skills of Successful Investors - Professional & Executive Development | Harvard DCE (2024)

Valued at more than $230 trillion, real estate investments are the world’s largest asset class and one of the most entrepreneurial fields, drawing people in with the promise of predictable, long-term passive income, positive returns on investments, and favorable tax advantages.

Because real estate is often considered a low-risk investment, many are quick to jump in with expectations of turning a quick profit. Popular television shows on buying investment property and flipping houses feed into the idea that investing in real estate is fun and easy.

However, not all real estate investments are low risk. Some require specialized real estate skills and many require patience and time to realize a positive return on investment.

If you’re considering becoming a real estate investor and entrepreneur, this guide to the real estate industry offers an overview of real estate investing for beginners and the five skills needed for successful real estate investment careers.

Types of Real Estate

Not all real estate is the same — properties are often zoned for specific uses. Before you become an investor, it is important to understand the different types of real estate and typical zoning regulations to guide you on what to include in your investment portfolio.


Residential real estate is property that has been specifically zoned for living in. This includes single- and multi-family homes and apartment buildings.

Commercial Property

Commercial property is real estate that has been zoned for businesses, typically industrial or retail. This could include shopping malls, office buildings, warehouses, and manufacturing sites.


Land refers to the ground surface and extends both below the earth’s surface and up into higher airspace. It encompasses any structures, water, plants, or minerals located on the land. Land can also be zoned as residential, commercial, industrial, agricultural, or other specific local zoning designations. Developers may petition local governments to change the zoning laws for land that they own (or want to buy).

Potential Career Paths for Aspiring Real Estate Professionals

There are so many career paths in real estate, but before you jump in, it’s important to understand that there is a difference between investing in and working in real estate.

When you work in real estate, you don’t put your own money into properties. Instead, you can sell a property for different owners, real estate development companies, or investment groups; manage properties; or help finance properties.

Real Estate Agent

A good real estate agent is an integral part of successful property sales. As licensed professionals, real estate agents are hired by individuals or business groups who want to buy or sell properties to help guide complicated real estate transactions. They typically work on commission.

If you want to become a real estate agent, your responsibilities include:

  • Understanding the local market. Based on your knowledge of the local market, you will help set asking prices to meet your client’s specific needs.
  • Marketing properties. You will advise your client on how to make their properties attractive (such as staging homes or suggesting cosmetic upgrades). You should also have the tools, experience, and contacts to market properties to a wider audience.
  • Handling the paperwork. Buying or selling property can be complicated – and real estate transactions require a lot of paperwork. As a real estate agent, you will know what documentation is required, and in many cases, can draw up the contract.
  • Negotiating price. Buying and selling real estate often involves negotiations, which you will facilitate.

Property Manager

Property managers are hired by property owners to manage the day-to-day property operations. As a property manager, your responsibilities could include:

  • Finding prospective renters
  • Collecting deposits and rent
  • Handling maintenance requests
  • Checking on properties if the owners live out of the area

Real Estate Investor

Real estate investors put money into properties in the hopes of selling that investment for a profit at a future date. If you choose to be a real estate investor, you could own one or more properties, or pool your money with other investors into a fund that includes several properties. You earn money when properties in the fund are sold. You may also earn income from the rental of the property while holding the asset.

As an investor, you could have a full-time job in a different industry or invest in other types of businesses.

Read more about how to become a real estate investor

Earning Money as a Real Estate Investor

Real estate investors can earn money in the real estate market even during times of rising interest rates. How you choose to invest will depend on your risk tolerance and available investment funds. There are several ways to earn money by investing in real estate.

Property Appreciation

Real estate generally appreciates in value over time — your profit comes from selling a property at a higher value than what you bought it for. Savvy investors buy properties in up-and-coming neighborhoods so their property appreciates at a higher rate over the long term. Property appreciation is generally a long-term investment that offers a one-time pay-out when the property is sold.

Rental Income

For predictable, regular cash flow and passive income, you could buy properties to rent out — either through long-term leases or as short-term vacation rentals. Choosing this investment strategy means you become a landlord, which makes you responsible for collecting the rent or making emergency repairs. You could also choose to work with property management companies to manage your rental investment property.

Property Flipping

Flipping houses has grown in popularity due to television shows that make it look easy and lucrative. To make money flipping houses, you could buy properties that are run down or outdated at a low price for the local market, then renovate the houses quickly and sell at a higher price. Flipping houses can have big profits, but it helps to know how to make repairs and do renovations on your own. Having good relationships with contractors who can help you estimate the costs of the repairs and make the repairs at a reasonable price is also helpful.

Real Estate Investment Trusts

If you don’t want to own property but still want to generate income from the lucrative real estate market, you can invest in real estate investment trusts (REITs), which act like mutual funds for commercial real estate. Typically, REITs are owned by a company that owns or finances commercial property. You and other individuals invest in the RIET, which is publicly traded, making it very similar to investing in the stock market.

If the REIT makes money, you earn dividends, which you can cash out or reinvest. The upside of investing in a REIT is that they don’t require a large up-front investment and you can earn regular dividends. However, you won’t benefit from property appreciation and you will be subject to taxes when you cash out your dividends.

Enroll in our 2-day real estate investing course today!

Ready to Become a Real Estate Investor? These 5 Skills Will Help You Find Success.

While anyone can invest in real estate, it helps to have some fundamental real estate skills and knowledge to find success and earn money. If you are a beginner, here are five skills you should have to find success in real estate investment.

1. A Familiarity with Real Estate Terminology

As with most industries, real estate uses specific terminology. It’s helpful to know and understand these terms when you decide to become an investor. This guide has explained many common terms, including REITs, appreciation, and flipping. Here are a few other terms you should know when investing in real estate:

  • Cash Flow. Your cash flow is calculated by the amount of money generated by a property minus the operating costs and expenses.
  • Due Diligence. Real estate is often a large investment, so it’s important to do your research about the property, including reviewing documents, estimating your operating expenses, and evaluating risks. This research is called due diligence.
  • HOA. This is an acronym for Home Owners Association, which oversees the physical appearance of many neighborhoods and condominiums. When you buy an investment property in an HOA community, you are subject to the HOA rules. It’s important to know those rules, as they could impact your ability to rent the property or make renovations. You may also have to include HOA requirements to your rental agreement (such as maintaining the lawn).
  • Turnkey Property. A turnkey property is a property that is move-in ready.
  • Inspection Contingency. Buyers and investors can include this in a contract, which means that the buyer must have the home inspected and review the report prior to the sale. The price can be renegotiated based on the findings of the inspection.

If you are planning to purchase a property as part of your investment strategy, you should also understand the different types of home mortgages, including adjustable rate, interest only, and fixed rate mortgages.

2. The Willingness to Make Long Term, Calculated Decisions

According to Forbes, real estate investment is one of the safest types of investments. However, they’re generally long-term, and you should research the properties and locations in which you are investing. Doing your due diligence prior to making an investment is critical, along with having a long-term strategy for realizing a return on your investment.

3. A Strong Social Media Presence

Investing in real estate is a popular pursuit, which means you must be quick to jump on opportunities. Having a strong social media presence can help you network with fellow investors, discover investment property opportunities quickly, keep up-to-date with the latest news in the real estate market industry, rent your property, and sell when you are ready.

4. Soft Skills

Because real estate investors spend a great deal of time interacting with others, it helps to have certain soft skills in addition to an understanding of the real estate industry. Soft skills include excellent written and verbal communication skills to maintain relationships. You should also develop good negotiation, problem solving, and organization skills. Having a willingness to learn will help you in the beginning of your investment career, along with being able to adapt to changing market situations.

5. Valuable Credentials

If you want to start investing in real estate, it’s a good idea to take some classes or enroll in a certificate program to help you understand the industry and market forces, learn how to build an investment strategy, and understand the financial aspects of investing in real estate. Certificate program classes are generally open to anyone, regardless of age, background, or current career, and are scheduled at times that are convenient for busy working professionals.

Take The Next Step Toward Becoming a Successful Real Estate Investor

If you are ready to become a real estate investor, Harvard DCE Professional & Executive Development offers Real Estate Investments: Assets, Markets, and Current Trends, a two-day program where you will learn the fundamentals of real estate assets, how to develop investment strategies, how to raise capital, and more.

You can also earn a Real Estate Investment Graduate Certificate from Harvard Extension School, which includes four courses that cover different real estate investment opportunities along with the forces that drive property values and the life cycle of buildings and neighborhoods. The program offers hands-on experience for creating financial models, analyzing cash flows, and measuring returns on investments.

There is money to be made in real estate with the right investment approach based on your situation and goals. Develop tactical, real-world knowledge and skills for investing in real estate by earning a real estate investment certificate.

Enroll today to start your journey in real estate investing!

Real Estate Investing for Beginners: 5 Skills of Successful Investors - Professional & Executive Development | Harvard DCE (2024)


How do I become a savvy real estate investor? ›

Becoming knowledgeable and educated about the real estate market is crucial, but this often requires more than just in-class learning. Understanding the risks, working with an accountant, finding help, and building a network are all part of finding success as a real estate investor.

How to be a successful real estate investor? ›

As an investor, it's crucial to focus on your properties and prioritize your time accordingly. This means making time to regularly assess your properties, maintaining good relationships with tenants to keep vacancy periods down, meeting with your team, and staying up-to-date on market trends.

How do I educate myself to invest in real estate? ›

Educate yourself on key concepts such as market trends, property valuation, financing options, and local regulations. Read books, attend seminars, join online communities, and learn from experienced investors.

What are the basic pros and cons of real estate? ›

Investing in real estate can be a good idea if done thoughtfully and strategically. It offers the potential for steady income, capital appreciation and tax benefits. However, it's not without its challenges, including high initial costs, property management responsibilities and market risks.

Is real estate investor hard? ›

Real Estate Investing Is Not for Everyone

It requires a specific mindset, personality, and business acumen. Property owners and investors must have strong negotiation skills, the ability to multitask while staying focused, and an understanding of the market and financing.

How do I become a smart real estate investor? ›

Assess the property's potential by considering factors such as location, market trends, rental income potential, and future development prospects. Calculate the Return on Investment (ROI) to understand if the property aligns with your financial goals.

Who are the richest real estate investors? ›

25 Richest Billionaires in Real Estate Industry
  • Wang Jianlin. Net Worth (2024): $6.4 billion. ...
  • Wu Yajun. Net Worth (2024): $6.4 billion. ...
  • Radovan Vitek. Net Worth (2024): $6.5 billion. ...
  • Edward Roski Jr. Net Worth (2024): $6.7 billion. ...
  • Robert Ng. Net Worth (2024): $7.0 billion. ...
  • Philip Ng. ...
  • Fredrik Lundberg. ...
  • Jeff Greene.
Apr 28, 2024

Can real estate investors be millionaires? ›

Becoming a millionaire real estate investor requires more than just financial knowledge and strategies. It requires a significant mindset shift that sets successful investors apart from the rest. First and foremost, it's crucial to cultivate a mindset of abundance rather than scarcity.

Who is the most successful property investor? ›

Kevin Young. With over 50 years of experience, Kevin Young is one of Australia's most successful property investors. He's bought and sold more than 650 properties over the years, but today his focus is on providing free advice and guidance for fellow investors through The Property Club which he founded in 1994.

How to invest in real estate when you're poor? ›

How To Invest In Real Estate With No Money: 11 Ways
  1. Private Money Lenders. ...
  2. Hard Money Lenders. ...
  3. Wholesaling. ...
  4. Equity Partnerships. ...
  5. Home Equity. ...
  6. Option To Buy. ...
  7. Seller Financing. ...
  8. House Hacking.

When not to invest in real estate? ›

Market conditions play a vital role in the success of real estate investments. If the local real estate market is experiencing instability, such as declining property values, high foreclosure rates, or oversupply, it may not be an ideal time to invest.

What do realtors struggle with the most? ›

5 of the Biggest Real Estate Challenges + How Agents Can Overcome Them
  • Fierce Competition. ...
  • Long Hours. ...
  • Time Management. ...
  • It Feels Like a Thankless Job.
Nov 18, 2023

What makes a savvy investor? ›

Savvy investors know better than to fall into the emotion trap. They make their decisions based on logic and data. They create a plan and then find a property that fits that plan – not the other way around.

What does savvy mean in real estate? ›

Savvy…" shrewdness and practical knowledge; the ability to make good judgments." An agent who is savvy knows the ins and outs of real estate, has broad and specific knowledge of his/her market, and understands the clients' needs.

Can real estate investors become millionaires? ›

It's important to understand that real estate investing is not a get-rich-quick scheme but a journey that requires patience and perseverance. By focusing on long-term goals, you can make informed and strategic investment decisions that will yield substantial returns over time.

How to become a billionaire real estate investor? ›

Let's explore the key steps on the path to becoming a real estate billionaire.
  1. Gain Knowledge and Expertise: ...
  2. Set Clear Goals: ...
  3. Identify Lucrative Opportunities: ...
  4. Build a Strong Network: ...
  5. Develop a Diversified Portfolio: ...
  6. Leverage Financing Wisely: ...
  7. Embrace Innovation and Technology: ...
  8. Stay Resilient and Persist:
Oct 29, 2023

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