Real Estate Investing for Beginners: 3 Rules You Should Not Follow
There are no hard-written property investment rules. But there do exist some tips that are often pushed as “rules” for the beginners. While most of them are pretty good and reliable, there is a handful of them that certainly stands out as unfitting.
If you’re new in the game, here are three real estate investing for beginners rules that you should not blindly follow:
1. Start With Residential Properties
Investing in residential properties remains a popular choice. And rightly so, given it, comparatively, takes less capital.
However, by no mean should it be the only option for the beginners.
In recent times the commercial projects have emerged to be a good investment avenue. And this is something that new investors must be open to leverage on.
Indeed, investing in, say, an apartment is much different vs. investing in a hotel. Moreover, the latter takes more capital at hand.
But the new investors can counter such challenges by working along with one of the top international real estate investment companies and pooling investment funds with other investors.
Do not adhere to the rule that you should only start your investment journey with homes that requires less capital. If you see good opportunities, be fine in making bigger commitments in commercial projects.
2. Take Risks Regularly
You’ve likely heard this many times that you should take risks.
The problem with this “rule” is that it makes many new investors feel pushed to, at times, take unnecessary risks. And such risks usually lead them to common mistakes and losses.
As a beginner, you don’t necessarily have to take any risks – not even the calculated ones if you’re limited in the capital.
Instead, it’s a better idea to work along with one of the reliable commercial and residential real estate investment companies who can fool-proof your decisions to a large extent.
Don’t assume you’re supposed to take risks regularly. In the beginning, when your portfolio is blank, it’s okay to take a lot of time in thinking, planning, and analyzing to make the best possible, risk-free investment decision.
3. Become a Full-Time Real Estate Investor
It sounds good to be a full-time real estate investor – or a real estate entrepreneur even. But then you might not necessarily be ready for that just yet.
The transition from a part-time to a full-time investor requires proper planning and strategizing. It’s a risky move that demands proper risk management in place.
Making an impulsive move could possibly be a big mistake on your part.
The transition must be progressive.
Recommended Read: How to Become a Full-time Real Estate Investor?
Again, becoming a successful real estate investor doesn’t have any defined rule. What may have worked with the top players might not necessarily fit for you. So, do not blindly follow every tip and “trick” you hear.
Understanding your own unique needs, requirements, style, and goals is the key. And this is possible only when you’re a life-long learner and are consistently growing yourself from hands-on experiences.