Progress through properties: after being laid off, Stephan Jackson enhanced his family's wealth by investing in real estate

Black Enterprise, March, 2005 by Patrice D. Johnson

8] To support the creation and growth of profitable, competitive black-owned enterprises

9] To use a portion of my wealth to strengthen my community

10] To ensure that my wealth is passed on to future generations

1 PRINCIPLE

To use homeownership to build wealth

While he knows he has a long way to go, this is Jackson's advice to anyone looking at real estate as a long-term investment:

* Be patient. "Learn as much about the market as you can [before you buy]," advises Jackson. He didn't realize new construction projects in North Carolina would compete with his properties for potential tenants until after he bought them. As a result, he has had to keep his rental prices low.

* Borrow money cheaply. Jackson says that if you can afford it, a home equity line of credit can be a good resource to finance properties rather than a high interest rate loan. "I financed the first two properties the way I did because I didn't have the capital or the experience," he says.

* Build a success team. It's important to find a good realtor, home inspector, and reliable contractors to help you select and rehabilitate your investment properties. Jackson says you can increase your success rate by developing contacts with people in city government who can help you understand economic development in your market, and fostering relationships with mortgage brokers and bank loan officers who can help you with financing. Also, having other experienced investors on your projects can broaden your knowledge of real estate faster. (For more information, see "Choosing the Right Investment Properties," February 2005.)