Investing in Real Estate: Economists expect rents to continue to rise in 2012

Common Mistakes To Avoid

Investing in real estate can be rewarding- and profitable – if you have the right property in the right area at the right rental price. Make a single mistake in your investing plan and you can end up facing problems that will eat away at any profits you hoped to gain.
Contact me at any time with your property investing questions. I am here to help you to avoid these common investor mistakes.

Cheap Does Not Always Mean Good

Just because the property is inexpensive doesn’t make it a great investment. If the property does not fit the needs of your target renters, you’ll be unlikely to rent the property continuously and effectively and will likely lose money in the long term on the ‘cheap’ deal.

Empty Equals Lost Money

If your renters turn over quickly, leaving gaps of time the property unrented, you’ll likely not make your investment goals. Check on the rental history of a property before purchase and also examine the amenities around the home including proximity to transportation, shopping and workplaces as well as the quality of the schools. If the property is not in an attractive area, fewer renters will want to live there.

Know Your Costs


When you start investing in real estate, you need to know exactly how much money you can afford for closing costs, fix-up and maintenance, taxes and general holding costs. Be prepared for unexpected repair costs for problem tenants, remodeling that uncover more issues that need fixing, and big-ticket items that may need replacing on short notice. Ensure you have a suitable cushion of cash for these expenses.

It’s Complicated

Owning your own home is one thing. Owning an investment property is completely different. Besides having to adhere to local laws for landlords, you may eventually find it easier to hire a property manager, which could account for around 10%-15% of the monthly rental. If your profit margins are predicted to be thin, you may want to reconsider your investment and keep looking for different property.

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