To make good apartment investment decisions you must know the market as well as your values and investment goals. Without your own market knowledge, you’re at the mercy of your broker and you’re not in control of your own wealth building.

Aim to learn two things. Learn why some investment properties sell for more than others. Learn why some neighborhoods offer greater opportunities to build wealth. You won’t be able to do that sitting in your living room.

Get Out of the House

Walmart founder, Sam Walton, had a sign in his office that said: “Nothing important happens in Bentonville.” He put it there to remind himself that the only way he could understand Walmart’s market was to get out and visit the stores.

Get out of your house and comfort zone. Google Maps and other “street views” are fun but they won’t tell you enough. The carefully staged and cropped pictures in marketing brochures are designed to show you only the best features of a property.

First-time investors should spend at least an afternoon of “windshield time” looking at different properties and neighborhoods. Forty hours is better. If you’re a seasoned apartment investor, make windshield time a habit.

How to Make the Most of Windshield Time

Start with a list from your broker of properties that have recently sold or are for sale now. Driving possible investment zip codes looking at recent sales and on-the-market properties provides knowledge and discernment which later make for wiser investment choices.

Begin by going out in the middle of the day during the work week. What are the buildings like? How well are they maintained? Look at the parking lots. Empty parking lots may mean tenants are at work. Full parking lots may imply government subsidized non-working tenants. One is not better than the other. They suggest different investment possibilities.

Go back to the neighborhoods at night. Are people out in the streets or in their homes? What does it sound like? Visit the same neighborhood on Sunday morning. The residue of Saturday night activities may be visible then.

Take notes so you don’t have to rely on your fallible human memory. Invite your spouse or significant other; two heads are better than one. Discuss your impressions with your broker.

When you understand the differences between submarkets, you’ll make better investment decisions. Over time you’ll develop your own gut instinct about properties, and that will make you a better investor and a better client.

Building wealth is neither easy nor too hard. Winners do series of routine things better than the people who don’t succeed. One of vital steps is understanding the RELATIVE values of different zip codes. It is no surprise that the lowest income zip code in your city sells for less than the highest income. Does the market judge the difference is 5% more? 50%? more? Often the best opportunities are finding and ACTING upon market mispricing. Windshield time is surest way to grasp those distinctions so you can act on them.

Click here for more on how to make better apartment investing decisions.

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Terry Moore, CCIM, is the author of Building Legacy Wealth: How to Build Wealth and Live a Life Worth Imitating. Read his “Welcome to My Blog.

Click here and find out how Terry and his team can help you make the most important financial decision of your next decade.