Are you a modern real estate investor? Would you like to be? Real estate can be a savvy investment, but you’ve got to do it wisely. A well-defined strategy can be a solid foundation that supports your portfolio and helps you to build wealth.
Do it right, and you may realize amazing profit potential. Do it wrong, and you could lose your house and everything in it.
Here are 5 of the worst mistakes made by modern real estate investors:
Failing To Plan Ahead
A lot of people make the mistake of buying a property before they know all about it. Sure, a grand home that’s priced to sell may seem like a good idea at the time, but if you don’t have a plan in mind before you buy, you could wind up with a headache instead of a great investment.
A good real estate investor sees problems before they arise and learns to avoid those minefields.
Inadequate Or Improper Financing
Proper financing is crucial for the modern real estate investor. An exotic or an out-of-the-ordinary mortgage is probably not your best option as far as real estate financing is concerned.
Investors who opt for non-conventional or adjustable rate home loans often find themselves in financial trouble when rates go up.
A Get Rich Quick Attitude
Don’t make the all-too-common mistake of looking at real estate as a way to make a bundle of money in a hurry. This is especially true for investors who expect to easily “flip” a property without doing any hard work.
Experts say to avoid late-night televised ads and seminars that promise to make you rich with real estate. If it were that easy everyone would be doing it.
Going It Alone
You may be a fully independent adult, but that doesn’t mean you should try to buy a property without the assistance of an experienced Realtor or other real estate professional.
In addition to a real estate agent, you’ll also need the help of an appraiser, a home inspector, a great attorney, and an insurance agent who understands the ins and outs of real estate investment.
A local real estate agency can show you homes that you might not otherwise know about. Consult with a local real estate broker who can show you great homes and help you to network with all the professionals you’ll need to perform a brilliant transaction.
If you think that buying a house means all you have to do is move in and enjoy your new residence, please think again.
Underestimating the true costs of home ownership is one of the worst mistakes made by modern real estate investors. Maintenance, repair and upgrades are costs that one needs to anticipate prior to making a real estate purchase.
I certainly don’t intend to make you shy about investing in real estate. If you are careful to plan ahead, know how much mortgage you can afford, and go into the deal fully prepared to pay future maintenance costs, you can make a transaction that eventually rewards you handsomely.