Thursday, May 13, 2021 / by Ray Lumenario
Although real estate may seem to be a safe bet for anyone, many investors make the same mistakes. Eliminate these errors from your investment activities and you will be well on your way to accumulate the wealth you want.
1. Poor search. Most of us do a lot of research when planning our vacation or buying a new TV. If you were buying one worth 100k, you can bet you would do even more research! Well, you should do that when you buy a piece of real estate, too.
2. Insufficient funding. Real estate investors often like wheels and transactions, and their transactions can have a lot of moving parts. Balloon payments, interest payments only, owner financing, subject to, and many others are ordinary.
•To make a deal, we can get carried away doing everything in our power. Getting a great price does not always justify the treatment if funding is inadequate.
3. Trying to do everything yourself. Although all real estate investors try this one time or another, you have little chance to succeed alone. A large investor will at least have a real estate agent, a lawyer, a title company, an inspector, Handyman, and an insurance agent-all on speed dial.
• You may not always need them, but they should already be in place and feel free to call them if you want their services. Use your specialists to the maximum advantage.
4. Paying too much. This is certainly related to doing enough research. Real estate offers mainly sink or swim according to the price. If you pay too much, you can't do much to rectify the situation.
• Early investors are more likely to merge the numbers mentally a little to make a deal. But if repairs work high, and the price they can sell for is lower than expected, then overpayment in the first place can be disastrous. Do your research and calculations and stick to your numbers.
5. Not accurately estimating expenses. This is similar to paying too much. Many investors will look at the repairs and think of themselves, "Everyone is saying it will take $20.000 to fix, but I'm sure I can do it for $14.000." But what if it takes $23.500? That's part of the reason to get the property at the right price is so important.
• The other aspect of this error is not accounting for all expenses. Landscaping costs, lawn cutting, insurance, utilities, property taxes, and new appliances can add up in a hurry. Be realistic with your repair plan and take careful notes of all your possible pensions. real estate investing is a relatively simple business, but mistakes can create big problems in a hurry. each experienced investor has made all these mistakes.
The best investors only do them less often than everyone else if not. In any housing market, there are money opportunities, so do not let these mistakes delay you!