Investing in property is fun. Many people are drawn to property investment as the property rate always increase per year. Investment in property seemingly guarantee a good return. That’s why people tend to miss out the risks and fall into loss. Only a handful of investor that can make it through and actually create wealth from their investment. While there’s no manual book to ensure success in property investment, at least you can avoid these beginner mistakes in property investment.
Using Heart Above the head
Many home buyers are, mistakenly, using their heart over head when they purchase their first home. It’s actually understandable as home is where you will raise the family. However, if you think home as investment, letting your heart rule the decision is not a good start. Emotional judgement can lead to over purchase, rather than negotiating for a good deal. Put possible outcome as the main consideration. Conduct rational analysis before buying a property. Consider whether the location will attract quality tenants or not. Or if the house will sustain property price market in the long term or not.
Fail to Understand How Property Markets Work
Do your homework before diving into the property field. Attending seminars and reading couple of books (or articles) will not be enough. You need to do a deep research in the surrounding area as well. Make yourself familiar with the area. Find out about vacancy rate and value of property of the area. This way, you can have a good idea about the success rate of the investment. If you see no potential in the area, both current or future, why bother to invest?
Not Matching Targets with Property
Your target markets should be a major contributing factor in property buying decision. It affect the location, type of the property, facilities, and others. If you are targeting a family with two children, for example, you would want to invest on studio apartment. A luxury house with a big pool might be not appealing for young workers in the heart of the city, who prefer more to minimalist apartment.
Not Devising Clear-Cut Planning
Property investment is more than buying a house. It extend to planning, developing, to marketing strategy. Before you begin purchasing, build a lucrative plan with clear goals. It will be the roadmap of your investment journey. Write down a set of goals that you want to achieve with the investment. Determine the final result of your investment. devise a coherent plan to get you there.
Giving Up Too Quickly
When you dive into property investment, don’t expect that it will give you dollars overnight. Many people have hight expectation when they first invest in a property—sometimes it’s too high. When the said property are not returning quick benefit, they think that property is not for them and throw it to the bin. Just like diamonds, knows that property investment takes times and efforts before it starts flowing dollars to your bank account.