It goes without saying that property can be a lucrative and reliable investment opportunity. Like with any other form of investment, knowing the mistakes to avoid can be the difference between getting a return on your investment or being left out of pocket. Here are some of the common mistakes to avoid when investing in property whether you are just starting out as a property investor or you’re a seasoned pro.
Lack of a clear strategy
As the saying goes – if you fail to plan, you plan to fail. Without a robust strategy in a place that outlines your goals and how you plan on achieving them, you’ll diminish your chances of success. Will you invest solely in HMOs? How do you plan on financing your investments? Which location(s) will you focus on? Having a clear plan in place will minimise risk while maximising changes of success.
Poor financial planning
When investing in property, the ultimate goal is to make a return on your investment. Not having rigorous financial planning in place will cost you. It’s imperative to ensure that you can not only afford an investment property but there is scope for a good return. Therefore, you’ll need to factor in other fees and charges that are outside the standard mortgage repayments.
Failing to do your research
Failing to do your due diligence is a common mistake both new and experienced can be guilty of. It can be easy to let emotions take over when investing in property. Thorough research will help you minimize risks and choose the right opportunities that align with your goals.
Buying property that isn’t below market value
Another common mistake to be avoided when investing in property is buying property that isn’t below market value. Buying below market value property reduces the risk of losing money on the property in the short-term as it gives you some level of protection even if prices fall. You can usually find such properties on popular property portals. The key is to look for homeowners looking for a quick sale.
Failing to choose the right financing option
With a vast number of financing options available, choosing the right option that fully takes your circumstances into consideration is crucial. While some options may seem appealing in the beginning, the reality may be different in the long run. It’s best to shop around and seek expert advice to ensure you are getting the right deal.
The bottom line…
Ultimately, a lot of the common mistakes made when it comes to investing in property can be avoided with experience and the right education. Thankfully property training providers such as Assets For Life offer thorough training to help new and experienced property investors to take their businesses to new heights.
Source: Property Investor Show
