If you are looking to expand your real estate investment portfolio, there are incredible opportunities now. But there is so much at stake, so it is important to be well informed and avoid common mistakes that can hinder your long-term success.
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Kuba Evgenev, General Director Realty ONE and a professional in the field with over 16 years of experience in real estate, said these are the biggest mistakes new real estate investors can make.
1. Trying to do it completely yourself
“If you want to start investing in real estate in today’s market, I urge you to join a mentor – someone who has done this before,” Evgeniev said. “Get your feet wet, get some experience so you don’t get burned.”
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A mentor can help you stay on track and focus on the long term.
“When investing in real estate, the goal is to accumulate wealth, but the accumulation of wealth occurs over time,” said Dzhudzhenev.
2. Shopping in the wrong places
When it comes to real estate investing, location matters and it’s important to think about long-term potential. To get the most out of your investment, avoid buying property anywhere solely on the basis of the fact that it is in a hot market. Use strategy instead.
“If you want to invest in real estate right now, I would go all-in to buy apartments or boutique hotels that can be put up for sale right in front of shopping centers,” said Dzhudzhenev. “I say this because shopping malls will start to lose popularity due to the rise of e-commerce. As a result, I expect retailers like Amazon to buy up these malls and turn them into distribution centers, creating jobs near the former malls. I believe that many of these apartments near shopping centers will be converted to condominiums to accommodate the workforce. So buy a property right in front of shopping malls and the profits will be astronomical. “
3. Homes leap in the current real estate market
While selling homes is a popular way to capitalize on real estate investments, Jewgieniew advises against doing so in the current market.
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“Don’t try to buy coup houses right now,” he said. “A year ago I would have said something different, but don’t try to get in and out quickly. This game is not worth playing right now. Buy it and keep it long term and focus on cash flow. “
4. Improper money management
It can be easy to get carried away with real estate investments, but it’s important to take the time to calculate and make sure your cash flow is positive.
“Don’t abuse your money,” said Jujenive. “If you want to go into real estate investment, I would, # 1, advise you to count and see when you have cash flow with two factors: interest rates and job share.”
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This article first appeared on GOBankingRates.com: It’s time to start investing in real estate – but don’t make these 4 mistakes