5 Common Property Investing Mistakes You Need to Avoid
Is your property investing strategy producing results? Consider these 7 common property investing mistakes with tips on how to avoid them.
Keyword(s): property investing mistakes
You figured it out! The best way to get ahead in the rat race is to have a side gig making passive money while you go do your regular 9 to 5.
The side gig you have in mind is real estate and for a good reason too! It's said that 90% of millionaires made their fortune in the real estate market!
But, how do you make sure you don't lose your shirt trying to break into the real estate business? Keep reading to learn 5 common property investing mistakes to avoid.
1. Not Doing Enough Research
The first mistake new landlords make is not doing their due diligence when researching rental properties in the area. Make sure you also look into each property you're interested in. Look for major issues that would need expensive repairs before moving in any tenants.
2. Choosing the Wrong Tenants
Another area to research well is who you are allowing to rent your property. Make sure to check references and credit to help make sure the people you rent to will pay on time and take care of your property while they live there.
3. Underestimating the Expenses
Yes, you can afford the mortgage and the taxes. But, many new landlords underestimate the total amount it costs to own a rental property.
One expense that many forget about is liability insurance. Experts recommend having at least $500,000 in liability coverage in case anything happens to your property or if the tenants try to sue you.
4. Property Investing Mistakes Caused by Going Solo
One mistake many new landlords make is trying to manage too much on their own. If you have a full-time job, adding maintenance duties on top of that can get exhausting!
Instead of overworking yourself and risking expensive mistakes, consider hiring a full-service property management company to help with your rental unit. A great management company will not limit its responsibilities to tenant placement or basic maintenance, but rather will help with services like maintenance and rent collection.
5. Not Pulling the Trigger
Another major mistake some people make is not making the decision to buy a property fast enough. The properties in the best areas with the most potential return on investment will sell like hotcakes. If you did enough research, these decisions should not take long for you to make.
Rest Easy When You're Making Money in Your Sleep
Though it's not the easiest business for everyone to get into, real estate is a great way to make money without having to punch the clock. That's why so many entrepreneurs include real estate in their portfolios!
As long as you avoid these common pitfalls of property investing, you'll enjoy the benefits of a profitable side gig. Who knows, you may even get to the point that you make enough money in real estate that you can quit your day job!
We hope you enjoyed reading this article and that you learned all about the 7 most common property investing mistakes to avoid. If you need help with property management, property investment advice, or leasing services, contact us today to get started!