Real estate investing myths that side-track your real estate investing journey can be a difficult road to navigate. What is a myth and what is honest and good advice? Here are some common real estate investing myths that you might run into sooner or later.
“How can I get involved in real estate if I can’t even afford to buy my own place?” is a common thought that prevents so many people from getting involved in the real estate market. But if we’re speaking honestly, this is a great time to purchase a property.
Right now, you do not have the obligation of another mortgage. By buying a property that can generate a good amount of cash flow, you can even save this for your own property down the road. It’s important however, to make sure that you are doing proper research into what areas can make the expected amount of cash flow you need.
When you continue offering a lower monthly rent to your tenants when market value for your property is much higher, you are missing out on a big earning potential. If you are scared that raising the rent too much will cause your tenants to want to leave, you can always raise it in smaller increments so that it doesn’t startle anyone.
Sure, it makes sense to you right now to buy while there are cheaper prices, but buying properties in a down market usually comes with more difficult economic conditions that will cause lower rent.
Some of the most profitable markets we have seen are in areas that are generating a lot of cash flow, which tends to indicate the inevitable appreciation of the property over time.
We get it, saving money is great, but when fiscal responsibility becomes penny pinching, we can see right through it. All too often, people try to be a jack of all trades in the real estate investing market. But the biggest problem is that when you try to become a jack of all trades, you become a master at none.
When you get involved in the real estate market, you realize there are so many people you need to be working with. Banks, mortgage brokers, contractors, property managers, agents… the list is never ending. Some investors think, “Hey, why can’t I just do this myself?” and try to go at it alone. This mentality is very, very dangerous.
We can’t stress how important it is to have a proper team of experienced professionals behind you. If something goes very wrong, are you sure you are familiar enough with real estate regulations and laws to handle it yourself? Are you certified to handle it yourself?
Having a team helps you avoid those messy blunders and help keep you on track to living life on your own terms. Sure, it will cost you a bit extra to keep you team, but that beat the alternative of having to pay to fix the mistakes you made while you were trying to go at it alone.
We’ve all been influenced at one point by those dramatic makeovers on HGTV that inspire a creative and handy side of us. The only issue is that these shows have already done their homework on profitable markets. Not every flip can generate a decent amount of profit and this can lead to many disappointments when it comes to investors.
There are times where contractors take longer than expected, or something breaks at the last minute. These delays can also delay being able to put the property back on the market to sell it. You already know what this means… the money will end up coming out of your pocket to account for the monthly payments.
Those who are all too dedicated to flipping a property don’t realize that delays are very likely, and sometimes even inevitable.
Additionally, some people flip the house but go way over the top. By this, we mean they install upgrades that they would like rather than the main upgrades that are necessary for the property.
Automatic lights, speakers around the house and heated bathroom floors, sometimes these features, even though they are great, are not always wanted by the main demographic. This can add extra expenses that aren’t necessary to make the property look attractive, sometimes less is more!
Navigating real estate investing myths that deter you from your goals is a complicated path to travel down. It’s important to remember that no one told you that you have to do it on your own.
It’s a great idea to build up a team of people that will have your back as well as have your best interests at heart. Join us for a free real estate investing class to learn more about how to make your journey a successful one!