“Real estate is an imperishable asset, ever increasing in value. It is the most solid security that human ingenuity has ever devised. It is the basis of all security and about the only indestructible security.” – Russel Sage
According to Ada Louise Huxtable, real estate is the closest thing to a proverbial pot of gold. Following this sentiment, it would be understandable why a lot of individuals would like to break ground in real estate investments. Unfortunately, while investing in real estate can be a very lucrative venture, there is no guarantee that it would be a profitable investment—particularly if you are buying in a downtrodden real estate market. However, when you are a novice at a real estate investment endeavor, it is practically inevitable to make mistakes. While committing errors is a crucial part in forging your experience with real estate and enhancing your skills, they can be quite costly. And though mistakes are necessary, you cannot make the same mistakes over and over again and continue to chase your losses.
Indeed, it would only be natural for one to commit mistakes in real estate—especially when you are just starting out. However, some of these rookie mistakes can be easily avoided. So, whether you are planning to start your real estate investment journey by selling an Avida Asten unit or elsewhere, here are some of the mistakes you should avoid:
One of the fatal mistakes a new investor can do is to follow the herd. More often than not, they do not back their pecuniary ventures with research but would rather listen to the media or other people and buy property in the hopes that it would appreciate. This approach to real estate investment is no different than gambling money at the casino or playing stocks.
2.) Buy at market value
More often than not beginners in the real estate industry would buy property straight off the market listings for market value. However, this approach would not work in the long run. Not only is it not sustainable, but there is no real assurance that the property you bought is profitable in the first place. Instead, learn how to negotiate or alternatively, try to scour the market for deals and be on the lookout for distressed properties. Select those dilapidated properties that go for less than seventy percent or more of their market value and give them a face lift.
3.) Get emotionally involved
Most beginners are guilty of this one as they have a tendency to spend minimal time in finding a deal. And once they do find a prospect, it would be as if they struck gold. They get emotionally attached and would do almost anything they can just to get the property. Do not let your emotions influence your decision and always think with a straight head. Make an informed business decision and ensure that you are getting the best deal out of your buck. Considering this, it would be best if you looked for as many prospects as you can that fit into the criteria. Filter them and then select only the best deals.
4.) Have only one exit strategy
Real estate investment is a risk in itself, so it is best to prepare for any sort of contingency that might occur. Unfortunately, most rookies would only develop one exigency and end up preparing only one exit strategy. To be safe, it is best to have a multitude of exit strategies at your disposal. You would never know if the one you have would not be applicable and as a consequence, you would be stuck with a losing deal.