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7 Horror Mistakes To Avoid In Property Investing That No “Guru” Would Dare Tell You

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7 Horror Mistakes To Avoid In Property Investing That No “Guru” Would Dare Tell You

7 Horror Mistakes To Avoid In Property Investing

Some of the mistakes that beginners often make when starting new in property investment!

Not doing your due diligence on the property.

  1. When you are at a viewing you won’t have much time, so you need to use this time wisely. Do as much desktop research on the property ahead of the viewing as you can so that you can be more targeted once you are there. 
  2. Not analyzing the deal properly. Most of the time a lack of experience and/or knowledge,  or your over-eagerness to get your first deal can result in huge losses instead of profits. You need to make sure you’ve properly checked the property, you know the location, and that you fully understand the strategy you want to use the property for. Make sure you’ve thoroughly analyzed all the numbers, checked out your competition, and have used realistic figures in your calculations.
  3. Not doing proper market research. Some people believe that one source of the truth is enough to make a decision, but in property, this is not the case. If you want to start a Serviced Accommodation business, then looking at nightly rates on Booking.com alone won’t be enough. There are several other platforms such as Airbnb or AirDNA that you should also use as part of your research.
  4. Choosing the wrong strategy for the wrong area. Most people fancy a particular strategy and want to use it no matter what. They don’t look at whether that strategy is suited to their location and their circumstances. For example, trying to create an all-en-suite 8-bedroom HMO in the middle of a small village may not be a great idea due to the low number of potential tenants in the village – however, a similar property in the centre of a busy town will work very well.
  5. Analyzing your personal/financial circumstances and choosing the right strategy accordingly. While all of our previously mentioned points are very important, we must not forget how important it is to know and think about our own circumstances. It may seem easy, but believe me, most people do not even think about this! For example, let’s say you really fancy building up a 5 Rent2Rent portfolio within 6 months, however, your available funds are limited to 5k. In this case, the only solution would be to start looking for JV (Joint Venture) partners or packaging deals to investors.
  6. The available time you have for your business is also crucial. Again, this might seem straightforward but most people never think about this one either. If you are busy from 8 am-8 pm with your day job, you’ll need to start planning your business in your available free time.
  7. Business plans/goals: Without a clear target/or goals supported with an optimistic but realistic business plan, it’s almost impossible to achieve anything. Once you’ve evaluated all the previous points you’ll now be in a better position to rethink your goals, then create a business plan accordingly. It’s not always easy, especially when you do it for the first time, but it IS possible with the right help.

 

If you are interested in property investment and marketing, check out our blog on Finding the best properties for a Serviced apartment!

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