There’s more to property investing than meets the eye. They say that smart people learn from their mistakes, which is true. But in real estate, the sharpest minds learn from the faults of their peers. A lot of people think they know everything there is to know about this business. They don’t and they eventually end up making the dumbest mistakes. Here are 7 top mistakes you might want to avoid if you want your property investment to reap great benefits someday.
1. Investing in spite of terrible neighbors
You just visited a beautiful house and you want to invest in it because you think it has potential. So far so good; but if next door neighbors have dreadful houses with backyards that haven’t been mowed in ages, bad roads, and far away schools and markets, you might want to think again. You may be able to fix a house and make it look like a million dollars, but you can’t do a thing to the neighborhood. Nobody wants to live in a dangerous, unappealing area. Always invest in a property with the location in mind. People want beautiful houses at affordable prices, but they are also willing to pay more for peace and comfort outside the house.
2. Hiring friends
It’s good to have friends, but specialists agree that one should never do business with friends. Things almost never work out, and conflicting situations arise all the time. Hiring friends to deal with your property investment leads to cost overruns and wasted time. You might even end up doing some extra work just because you’re too ashamed of asking your friends to do it.
3. Purchasing homes with title issues
Don’t buy a house with title issue if you’re new to the real estate market. There’s opportunity for profit with these properties, but you must know what you’re doing. Avoid making colossal mistake by consulting with a lawyer. Make a plan and be aware that the risks involved are huge. If you don’t have a lot of money to invest, stay away from homes with title issues and stick to homes with clean titles.
4. Investing in properties that only “look” good
As human beings, we’re tempted to let our emotions get the best of our judgment. In real estate, you can’t let that to happen. A house that looks amazing on the outside may come with a lot of issue “underneath”. It’s so easy to let your heart speak instead of your brain. The more rational to stay the better chances you have to land a good deal.
5. Breaking promises
As an aspiring investor looking for his big break in the property investing community, you should always keep your promises. Don’t make rushed decisions and don’t make unfounded allegations. In this business, word travels fast, and you don’t want to appear dishonest in front of potential buyers or other investors.
6. Thinking that property investment means getting rich fast
This is probably the dumbest mistake an investor can make. Investing in property demands time, expertise and patience. The buyer should be prepared to wait for his purchased house (s) to appreciate; this could take years. There are many self-appointed “experts” who claim they have the recipe for success in real estate. They can make property investment seem so easy and straightforward. In fact, it’s not; and if you want to make a profit, you have to invest money to get money. Being smart is important, but there are things you just can’t mess with. Rather than take unnecessary risks, it’s best to stay on the safe side.
7. Avoiding due diligence
A lot of investors are pressured by time. They’re compelled to check deals fast and move on. This can cost them in the long term. Never, but never sign a contract without reading it in full from top to bottom. If you’re a newbie in this business, others will want to take advantage of your naiveté. Providing that you do your due diligence and you stay informed, nothing bad can happen. Know about market conditions and costs because this data will help you negotiate. Don’t just assume that all properties appreciate, and before making any purchase find out as much as possible about that property.
Whether you can afford to invest a lot of money in real estate, or you’re just getting started, make sure to avoid the 7 mistakes we just mentioned above. The tips apply on an international scale too. So if you want to buy property in Turkey, get professional advice and always keep a close eye on the numbers.