Common Real Estate Investing Mistakes by pfinancecr

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									COMMON REAL ESTATE
 Investing Mistakes
Common Real Estate Investing Mistakes


Although real estate may seem like a sure bet for anyone, many investors make the
same few mistakes. Eliminate these errors from your investing activities and you'll be
well on your way to accumulating the wealth you desire.


Avoid These Mistakes


   1. Poor research. Most of us do a lot of research when we plan our vacations or
      purchase a new television. If you were buying one that was worth 100k, you can
      bet you’d do even more research! Well, you should be doing that when you
      purchase a piece of real estate, too.



   2. Inadequate financing. Real estate investors frequently like to wheel and deal,
      and their deals can have a lot of moving parts. Balloon payments, interest-only
      payments, owner financing, subject-to, and many others are commonplace.

           To make a deal happen, we can get carried away doing everything in our
           power. Getting a great price doesn’t always justify the deal if the financing
           is inadequate. Are you really sure that you can unload the property or get
           other financing before that balloon payment comes due?


   3. Trying to do everything yourself. Though every real estate investor attempts
      this at one time or another, you have little chance at success all by yourself. A
      great investor will have, at a minimum, a real estate agent, attorney, title
      company, inspector, handyman, and insurance agent – all on speed dial.

           You may not always need them, but they should already be in place, and
           you shouldn't hesitate to call them if you do want their services. Use your
           experts to your full advantage.



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                                      4. Paying too much. This one is certainly related to doing enough research. Real
                                         estate deals primarily sink or swim based on price. If you pay too much, not
                                         much can be done to rectify the situation.

                                              Beginning investors are more likely to mentally fudge the numbers a little
                                              bit to make a deal happen. But if the repairs run high, and the price they
                                              can sell for is lower than expected, then overpaying in the first place can
                                              be disastrous. Do your research and your math and stick to your numbers.


                                      5. Not estimating expenses accurately. This is similar to paying too much. Many
                                         investors will look at repairs and think to themselves, "Everyone is saying it will
                                         take $20,000 to fix, but I'm sure I can get it done for $14,000."But what if it really
                                         takes $23,500? That's part of the reason getting the property at the right price
                                         is so important.

                                              The other aspect of this mistake is not accounting for all expenses. The
                                              costs of landscaping, lawn mowing, insurance, utilities, property taxes, and
                                              new appliances can really add up in a hurry. Be realistic with your repair
                                              planning and take careful notes of all your possible expenses.



                                   Real estate investing is a relatively simple business, but mistakes can create massive
                                   challenges in a hurry.


                                   Every seasoned investor has made all of these mistakes. The best investors just make
                                   them less often than everyone else. In any housing market, there are moneymaking
                                   opportunities, so don't let these mistakes slow you down!




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