Are you thinking of joining the property investment game? Have you read online or heard stories of people who completely secured their financial futures by simply finding the right property, flipping it and making a killing while at it? Well, so did my daughter. I’m not ashamed to say that I have provided something of an excellent life for my family.
My daughter grew up knowing that property investment was both lucrative and stable, because she saw that in me. What she didn’t know was that underneath those still waters, I was paddling like crazy to stay afloat most of the times. She soon learned that some mistakes can make or break your property investment plans. Here are my daughter’s biggest property investing lessons that could help you avoid common mistakes of first time home buyers.
You have to look at it from a long-term perspective
Imagine if you had the chance to go back and buy a property from 20 years ago. Knowing what they are worth now, what would you not do to pick up as many houses as you could? That is the thing about property investing. It is cyclic and in the long run almost always ends up making you a profit.
The problem is that most people today are in it for the quick cash. They want to be millionaires within a year. They, therefore, buy property and drop them as soon as the market starts heading southward. If only you could assess the situation and maybe wait a little, you could very well end up in the black.
There are markets within the market
The investor segment of the market may not perform as well as the homebuyers market. Sometimes, the high-end market may not be as lucrative as the HMO market and so on. In the property market, there are several layers to think about and explore. Just like there are several regions at which you can look. The point is, you need to be conversant with as many of these markets as possible and learn their cycles. This is how you spot opportunities and diversify.
There will always be a reason why you should not invest
Property investing is fundamentally about taking risks. Calculated risks, but risks nonetheless. If you wait for the ‘perfect’ moment to invest, you might be waiting for quite a while. There isn’t a year that does not have its own set of reasons why you should not invest. The trick is to treat your business as a long-term project and to find ways to mitigate the risks.
At the end of it all, my daughter discovered that property investing isn’t a ‘get rich quick’ scheme at all. In fact, you may go for years without seeing your property values rise just as you may experience incredibly boom years. The idea is to do your research, use debt as a tool and invest wisely. Forget going for glory and glamour.Tags: first time home buyers, first time home buyers mistakes to avoid, lessons for first time home buyers