You might be wondering how to go about investing in your first property?
Thanks to the internet, there is no shortage of rulebooks that you can follow to make an informed decision. But here’s the catch – there are a number of pitfalls associated with the property game.
Let’s take a look at some of the most common mistakes made by first time investors, and how you can steer clear of them.
*Bigger is not always better-
If you’re buying property for the first time, start with something small. A property that costs a fortune isn’t going to maintain itself- so it becomes really tough to manage. A smaller, more affordable property will help you learn the ropes of the business without draining your bank account. Once you’re a pro, you can extend your reach every 3-4 years.
*You cannot overestimate your income from the property–
We get that you are excited, but if you miscalculate the inflow of rent, you will suffer crazy losses! Also, while considering expenses for the property make sure you take note of ALL the expenses- including the cost of making the place habitable for tenants.
*You should always, ALWAYS, do your research before buying any kind of property.
Real estate seems like a glitzy affair from outside, but it can turn sour quickly if you don’t know what you are doing. You can get duped of your hard earned money. Read the specifics about the property through and through- online articles, magazines, anything you can lay your hands on. The more you know, the better.
*Guess what’s more important than your property? It’s location.
It is the location of your property that determines how much rent you can charge, what facilities you can avail or provide, the price of the property, etc. You might want to buy a property in your own location because you know the place like the back of your hand. And that’s absolutely fine. But don’t rule out the possibility of buying a property elsewhere if investing in your locality is not a suitable venture right now.
*Being a new investor, if you happen to have limited resources, you can enter into partnerships with other investors. This only works if the people you are partnering with are trustworthy professionals and experienced in their field. DO NOT enter into a partnership with anyone without acquiring enough information about them.
*Being too hasty or too cautious about the purchase is another drawback. Clinch the deal only when you feel comfortable with it. On the other hand, don’t miss out on opportunities because of your hesitation. Think about this like a game of chess- you’ve got to make a quick and informed move.
You might be wondering- “is there a foolproof approach to property investment”?
The truth is, no. Obviously, you will make mistakes.
Want to know the best part? You can always count on us at Warner Quinlan for some pep talk before your best buy.
