Thinking of buying real estate in Detroit? If so, you’ll want to make sure you steer clear of these expensive problems that other investors have discovered the hard way! Read this blog post to learn the 4 common mistakes investment property buyers make in Detroit…
Although real estate investing can be simple, fun, and highly lucrative, it only works if you play the game in the right way. For some, it can be a costly disaster. Fortunately, we’ve seen the problems and are sharing them here with you so you can skip the challenges and go straight toward your goals. Here are 4 common mistakes investment property buyers make in Detroit.
Failing to act fast: Real estate investing isn’t like stock investing. With stock investing, there are millions of stocks to buy every day and when you find one you want to invest in, there’s a good chance you can acquire it. But all real estate is one-of-a-kind. Simply put, you can only invest in one property. So when an opportunity comes by, jump on it.
Investors who work with us will often be ready to jump at a real estate investment as soon as they hear about it from us because they know that some other investor could snatch it away from them at a moment’s notice.
Failing to do your due diligence: Like all investing, real estate investing should be done without emotion. When you hear about a deal you should dig in and crunch the numbers to make sure it’s right for you. Don’t just acquire a deal because it’s a real estate investment… even in real estate deals there are deals that make sense and deals that don’t. Only your due diligence will reveal that information.
Being overly optimistic about returns: We are very bullish on real estate investments and we believe that a portfolio of well-chosen real estate investments will outpace a portfolio of well-chosen stocks in the long-run. However, it’s easy for investors to be overly optimistic about the returns they expect — for example, by hoping for higher rental income than is realistic and by ignoring some of the expenses that might eat away at that income. You can make good returns in real estate but you need to make sure that you’re estimating your returns realistically and accounting for the right income and the right expenses.
Stopping at one: Some investors acquire one real estate investment and then stop. But why stop when you can build a passive income-generating portfolio that may even allow you to retire early and very comfortably. Start with one property and use it as a learning experience… then branch out and invest in more.
Real estate investing can be fun and lucrative. But not all real estate investments are equal. So make sure you review these 4 mistakes to help you avoid the hassles, headaches, and frustrations in your investing.