10 Common Mistakes to Avoid as a Beginner Investor

May 9, 2021

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By Rentvesting Admin

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10 Common Mistakes to Avoid as a Beginner Investor
Posted on Sunday, May 9th, 2021

Rentvesting is the leading provider of advice, support and guidance to new and seasoned property investors.

If you’re just entering the market for the first time, there are certain things you should avoid. As professionals with years of experience in the game, we can help guide you.

What are the risks of property investment?

Let’s consider the ten biggest mistakes new buyers make, and what to consider before jumping in.

  1. Making decisions based on emotion – Remember that the house is not a family home – it is an investment.
  2. Not being patient – Realise that you will not make $1m overnight. It’s a waiting game.
  3. Acting too impulsively or not acting at all – Find a happy medium. Learn as you go, but do not be reactive.
  4. Selecting the wrong property – Consider location, affluence, surroundings and growth potential.
  5. Poor research – Discover the neighborhood, trends and seller’s motivation etc.
  6. Overcapitalising – Stick to your budget to avoid loss in the long run.
  7. Trying to time the market – Timing the market is tough. Making smart choices yields results.
  8. Poor planning – Measure your progress towards your goals and objectives.
  9. Weak cash flow management – Seek advice on all costs involved in acquiring and holding property.
  10. Lack of understanding – Reach out to us for advice beforehand.

Are rentals a good investment?

They absolutely can be if you get it right! Benefits include reaping tax benefits via gearing, area growth over time, leveraging to accelerate a return – and, of course, financial growth.

What if I end up with a bad investment?

The results can be good, bad and mediocre, and often cycle through these stages during the first few months. But it’s not the end of the world.

Our team can help you in the early stages to avoid this, and also if you find you’re dealing with financial loss and/or lack of equity. Don’t leave your concerns any longer – contact us today.

Is now a bad time to buy?

With housing prices and competition reducing, the short answer is no. Almost 67% of Australians currently believe it is a good time to buy. Shockingly, this is the highest figure since mid-2019, according to a new survey, and is likely due to COVID and the various effects this has had on the market.

As a result, Federal Government initiatives have surfaced, interest rates are historically low, and auction clearance rates are rising. It’s important to review your buying capacity, as this affects when, where and how you can invest.

Don’t delay – our professional team can take you through calculators to assess your pre-approved finance borrowing capacity.

Let’s recap

As you progress through your journey, you will realise that real estate is more a game of finance, with some houses thrown in the middle.

There are numerous considerations to make. Luckily Rentvesting understands and will be able to guide you in the right direction. Contact us today to determine the best strategy going forward for your individual circumstances.

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