The road to making money from property investing is fraught with many dangers and pitfalls that, if you are not careful, will bleed your dry of every penny you have.
This article will help you to recognize the one big mistake that most novice property investors make. Therefore, giving you the knowledge to enable you to avoid it at all costs and to increase your chances of being successfully.
When most investors start out trying to make money from property investing, their first thoughts tend to turn to where to buy the properties and what sort of properties they should buy.
These are excellent question to think about. In fact, they are vital. However, it is the novice investors next thought and action that tends to be their undoing and tends to cut short what could have been an extremely successful career in property investing.
The first thing most beginners will do is jump straight into imitating the exact same strategies of successful property investors of the past. They will read old books and watch TV and listen to people that have made a fortune in property five, ten or fifteen years ago.
This isn’t necessarily a bad thing since one of the best ways to become successful at anything is to imitate those who are already successful at it. However, the flaw in their logic comes in the fact that they don’t take into account that just because a certain investor made a fortune in the past by investing in a certain type of property in a certain location, doesn’t mean that they will get the same results today by investing in the same types of property in the same location.
There is no disputing the huge amount of wealth that has been created by these property moguls who started property investing in years gone by. The eager would be investors watch these people on TV and dream of emulating their success. Yet, they fail to understand a vital piece of the puzzle, this piece of the puzzle is a key to whether they are successful long-term making money from property, or not. What is this piece of the puzzle?
“Before you can start making real wealth from property, you have to understand what sort of a property market you are in at that moment in time.”
Just because someone made a fortune buying properties off plan in the eighties, does not necessarily make buying properties off plan now, a good financial prospect. This is the vital kink in the chain of many novice investors. It is their Achilles heal.
Too many people starting out on the road to financial freedom through property investing don’t understand this one important point.
This is – The one big mistake that most novice property investors make!
They need to learn to not just analyze the strategy that successful property investors have used, but they also need to analyze those particular investor’s circumstances. What was happening in the property and economic market at the time? How much money did these investors have as a reserve fund? Who were these investors getting advice from? These are just a few questions to ask.
It is only after asking these, and many more, questions, and then relating it to the current property market and economy and their own personal situations, that they will then begin to be able to formulate a plan that can help them to be successful in today’s property market.
Understanding, whether it is the right time to buy off plan, or to buy second hand properties or whether they should be buying 2-3 bed flats to rent out in a certain location, rather than 5 bedroom houses to sell on, are key things that the novice investor needs to get right.
The successful property investor of today and tomorrow needs to know how to understand and show respect to the property market. Treat the market right and with understanding and it will reward you by showing you the right decisions to make and when to make them. It will do this while other investors are throwing good money after bad, chasing property deals that are only going to bring empty pockets and misery to those who capture them.
Learn how to read the property market and it will also show you clues as to what the future holds for it, so that you can be making astute property decisions well before the rest of the hungry property investing crowd.