Real estate investing has a strong reputation for producing lucrative gains to investors while being a low-risk strategy. While it is an excellent vehicle to achieve financial freedom, getting to that level can be frustrating. The majority of new investors get discouraged very quickly, and they either drop out, or they remain unsuccessful for a long period. However, being successful in real estate investing can be a straightforward process as long as you avoid some common mistakes and traits. Top investors are not only incredibly resourceful but also extremely focused on what they do. Although the real estate arena remains extremely competitive, top investors manage to produce amazing results by following some relatively easy rules. More than 75% of inexperienced real estate investors fail due to their lack of some particular characteristics. It's time to identify what successful investors do and compare it with what the majority of investors do.
1. Sticking to a well-researched strategy.
This tip is maybe the most important one you should consider since it can set you apart from the majority of the competition. Steering away from a successful strategy is a mistake even senior investors do. That is why you should be extremely careful with this one. You should develop a bulletproof plan that takes advantage of your experience and knowledge base instead of trying to mimic other people. Following what others do is a recipe for disaster especially for the inexperienced investor. Maintaining focus on what you know is what will make you stand out at the beginning of your career. By all means, I do not advise you to stop trying new approaches but once you decide to pivot make sure you know everything there is about your new strategy. Last but not least, don't try to produce an attractive business plan just because you think it would be successful. Boring methods are usually those that provide the best results year in and year out.
2. Negotiating is the Key.
While most investors remain well aware of the importance of negotiating, few of them are actually able to practice effective negotiation techniques and achieve optimal results. Every number matters and that is the most important lesson you have to learn early on your career otherwise you could jeopardize your financial future. Start every negotiation after you have studied all the numbers thoroughly. If they don't add up, don't try to make them work or believe that something is going to change in the future. Act now based on your research. Also, you have to know that banks have stopped lending to the majority of investors, so you should come up with an effective financial strategy. Another aspect you have to learn is how to cold read other people when you are ready to negotiate. Investors that manage to break the ice as soon as a negotiation starts have more chances of closing the deal than the one's who remain tight. Being able to negotiate effectively is an incredibly useful skill that can save you thousands or even millions of dollars. So, don't be scared and try new techniques until you find your unique approach.
3. Being well-educated.
One of the most usual mistakes that investors make is not taking the time to become educated about the real estate market. They are not interested in local events, networking seminars or books. On the contrary, successful investors manage to build a strong educational network from the beginning. Mentors are a great way to kick-start your learning process as you will not only understand how the market works but also network with some of the most influential people in your area. In the beginning, being able to filter all the available information and making an educated decision is crucial. Every investor early on his career has to find people that can compliment his skill set and abilities. Don't try to perform everything on your own and focus on building a well-rounded team.
4. Perseverance
This is a trait that every successful person shares. No matter how educated, you are if you don't work as hard as you can you will not be successful enough. While coming up with excuses is easy, working as hard as you can to find a sustainable solution is very hard. Real estate is not a quick scheme that promises easy money, and it is critical you understand that fact early on your career. Getting all the appropriate education may require a lot of work but it will distinguish you from the majority of successful investors out there. So, work harder than anyone else and always try to come up with new ideas and solutions if you want to achieve a long lasting real estate career.
5 Understanding the risks
Just like any other investment, real estate has its own unique risks. Although outsiders tend to think that investing in real estate is a piece of cake, in reality, it is the exact opposite. Prudent investors are able to identify the associated risks regarding deals as well as legal implications and they form their strategy accordingly. So. start by educating yourself on all possible risks you could face and adjust your plan around them. That way you will be prepared for the worst possible scenario.
To conclude, it all comes down to how far are you willing to go to achieve the success you crave for. If you are uncomfortable with your life, and you are passionate about real estate investing don't hesitate to rise to the challenge. Successful investors combine their lifelong passion with a unique skill set and knowledge base. Changing your mindset can be an incredibly useful shift that will skyrocket your investing career. As challenging as it can be, real estate is a business that rewards you for every extra effort you make. Additionally, since this business has to do with people, integrity and respect are those characteristics that make the difference on how long your career lasts. Following all of the above advice will keep you away from the most common mistakes, and it will provide you with a mindset that will shape your career in the future.