- How Much Money Is Needed To Invest In Rental Property?
- Should A Real Estate Investor Get An Agent’s License?
- 5 Big Factors That Affect The Costs Of Renovating Your Home
- SIBOR Hike – What You Can Do With Your Current Loan
- 6 Basic Don’ts Of Real Estate Negotiation Tactics
- Will New Condo Relaunches Trigger The Great Property Sale We Have All Been Waiting For?
- 10 Proximity Amenities That Add Value To Real Estate
- How To Get Personal Loans More Easily With Good Credit
14 Reasons Most Investors Fail At Real Estate
Anyone who promises you that he can make you a property millionaire by attending a $997 one day workshop is not telling the whole truth. I believe every adult with common sense will implicitly know that the game of real estate is not as simple as rolling a dice and see where you stop on the game board. While nobody can guarantee that you will achieve success by following a set of instructions, many can agree that you are bound to failure for these following reasons.
1) Getting too theoretical
It is very easy to say that you will buy a house and rent it out immediately at $3000 a month and use $2500 to repay the mortgage. Actually doing that successfully is a whole different matter.
2) Lacking in persistence
It is a common saying that a lot of people give up just when success is so close. When you do not have the drive to be persistent or lack the resources to do so, you might want to give real estate investing a miss.
3) Paying above market value
There is nothing wrong in paying above what a home is worth. But usually only home owners with no interest in investing will do so. Investors who always have an eye on the bottom line seldom (if ever) pay above the value of a home in the market. Low balling is always present here.
4) Lack of knowledge
Real estating requires knowledge. A lot of it. It is astounding how many people buy properties for investment without ever having even an in-depth look at population data, income levels, master plans, etc.
5) Lack of organisation
If you do not keep track of things from the start, things can quickly get out of hand leaving you with a mess that you can never clean up. With the number of parties involved in real estate transactions and the amount of costs items to take into account, organisational skills are essential to keep yourself afloat.
6) Failure to identify and follow through on objectives
Many successful entrepreneurs and investors will agree that the number one basic item for success is to identify a goal and be focused on achieving it. Flip flopping like a pancake all the time is a sure sign of a lack of confidence and a lack of knowing what to do.
7) Inability to identify priorities
The reason why you need good knowledge is so that you are able to identify important things that have to be done first or in a timely manner. Learning about priorities is best done by getting hands-on experience.
8) Unclear exit strategy
If you are someone who says that you will decide what to do when you view the market in 3 years, you are unclear on your strategic moves. Before buying a property, you should have already planned out the who where what when how of your exit strategy.
9) Bad credit
If you only learned about your embarrassing credit record after failing to complete a property transaction, you are obviously not ready to start investing in the first place. Unless you have always planned to go for private funding for your investment activities, the bank is the most likely place to go for financial leverage. And to deal with banks, you need a satisfactory personal credit record. This is a very basic requirement. Learn to look up your credit and solve problems before buying property.
10) Getting questionable advice from third parties
You can expect a promoter of a particular development to be forever bullish on the project he is promoting. And you can expect a used car salesman to have 1001 reasons why used cars are better than new ones. When you see an advertisement on a free seminar of the great prospect of London properties, you can surely expect to be sold London properties on the free seminar. So if you are going to get third party advice, always make basic checks on conflicts of interest.
11) Lack of discipline
It takes self-discipline to follow through on your work when you are self-sufficient. If your plan includes going though real estate listings everyday, you must follow through without fail. Deviation from your plans will just induce you to deviate even more in future. Soon you become lazy and wonder why you are unable to succeed.
12) Failure to manage your time
Property investments can be very time consuming activities. It would become an even bigger challenge when you have a day job. And surely you do not want to neglect your family. The purpose of Investing is after all, to build a better life for your family. If you are someone who often loses track of time or does not have the ability to be punctual. It is a big sign that you will not be able to handle the heat. Sometimes even on weekends, you must have the capacity to drop everything and divert your attention when something important comes up.
13) Lack of self-belief
The most important criteria for success is self-belief. If you do not belief that you can make it, you have already lost the plot. You must have the belief that if you are to follow through on your plans, success will appear on the horizon. This is the foundation of your personal drive and persistence that will push you forward to conquer adversity when challenges arise.
14) Lack of support
Many successful investors can ascertain that they achieved success when no one else believed in them. But they will surely admit that if they had great unwavering support from family and friends, they could have achieved better results or made the journey more pleasurable. We are social beings and many people need social support in order to follow through on things. If you are one of such, find your support and draw motivation from them.