OK, today we're going to talk about how NOT to be profitable as a real estate investor.
Real estate investing can be a great way to your build assets and achieve financial security. However, in order to be profitable, you need to the many landmines that kill your profits.
Here are 7 costly real estate investing mistakes:
Not having a plan
- Some people shop for a "deal", then decide what to do with it. That's backward. First, decide what kind of revenue properties you want, how big, how many, etc. Have a plan before you buy.
Not being educated
- Before you buy, read as much as you can, study the market, get sound advice.
Looking to get rich quick
- Make sure you understand how much work is involved and how long it will take to realize the significant returns you expect.
Doing it yourself
- You're not an expert. So make sure you have expert support, including a real estate agent, appraiser, home inspector, lawyer, mortgage broker, tradespeople, etc.
Overestimating cash flow
- Budget for vacancies and expenses (like property management) that can dramatically reduce returns.
Not doing due diligence
- Make sure you use an inspector, title insurance, accountant. Do everything you can to avoid costly mistakes.
Not having a Plan B
- Sure, you want to earn rental income. But what if the rental market collapses? Make sure you're prepared with strategies for selling, rent-to-own, etc.
So there you have it. I've just given you 7 inconvenient truths of real estate Investing.
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Jessi Johnson Vancouver Mortgage Broker Vancouver Luxury Realtor