8 Common Mistakes in Property Investing

In the previous article, we have been talking about how to start a property investment. Also, in the next article, discussed how to do successful investing in property, and how to buy a house for your investment purpose.

Well, before you really start to put your money in property investing, it is worth to read this article and think before you start.

Here are 8 Common Mistakes in Property Investing:

1. There are no clear goals and plans.
This is the most important of whatever we do. If we do not have any clear goals, the results will be not clear as well. It is good to have a clear goal in an investment. It is necessary and good to write down your clear goal, so it is easy to remember. For example, I want to have one unit of apartment to be rented out in 2013 and give me a passive income around USD1000/month.

2. Not seek for advice from property expert or a successful property investor.
This is usually neglected. But, if we do not get feedback or input from expert people who are already have much experience, most likely we will make mistakes which should be avoided.

3. Buying a home as an investment that did not generate positive cash flow.
Indeed, often, the first time we buy a house usually does not for investment, but if we want to buy a first home to invest as well, then you should pay attention to how the actual cash flows. Or, if the cash flow is not your investment goal, then the capital gain is the thing to be noticed.

4. Buying your own property and not see the potential buyer in the future.
Often we are only concerned with good design, interior, but the location, for example, this property is very difficult for people to reach. Of course this will be a problem if you are going to sell it or rent out to prospective customer.

5. Buy a cheap property ,but in the wrong location.
When you buy a property, do not get stuck on price only if the location of the property is not so good. This will make it difficult to sell, even though the price below the market price.

6. Buying a dream house and then making an excess renovation.
Usually for the first-time buying, people are tend to re-design his home based on his expectation. But what happened next? The time will come when you feel difficult to pay the mortgage and it seems quite a burden. Especially if it's the fact that his house is not in a good location and at a good price to buy, it is clear that would be very difficult to be an investment.

7. Buying a home beyond the financial capabilities.
We have to consider our financial capability. We have to consider the costs such as sales tax, insurance, monthly installments, operating costs, and also some renovation needed at an early time.

8. You still pay the mortgage until you retire.
You were thinking about buying a small house with small start-up costs. But it turns out that the mortgage was taken for very long time until you retire, you still have to pay the mortgage. Unless it is for rented house and provide a positive cash flow, so that mortgage payment is not a problem.

Well, try to look at and consider the above things before we took the decision to invest in property, so that we could avoid the common errors. And create a better personal financial planning.

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