If you wish to become financially independent or have passive income, then real estate is usually a wise choice in that matter. It seems that Millennials are aware of that because 55% of them said in a recent survey that they were interested in real estate investing.
Are you a newbie real estate investor as well (millennial or not) and worried if you are doing it right? We've got you covered. In the article below, we share with you real estate investing mistakes that you could be making that can cost you big.
1. Waiting Too Long
Do you get swamped by analysis paralysis every time a good real estate deal comes across your table? Don't waste your time dilly-dallying when you have a potential real estate investment in front of you. The more time you waste, the more likely it is that someone else will snatch up the property from under your nose.
2. Not Crunching the Cashflow Numbers
What is real estate investing all about? Well, the main object of it is to make passive income or positive cash flow every month.
There's no point accumulating a bunch of properties in your real estate portfolio that have a negative cash flow or no cash flow at all. That's not going to help your long-term goal of becoming financially free and giving up your 9-5 job.
Every time you look at a new potential investment, crunch the numbers first to ensure you have at least some cash flow coming in from that property every month. This way you can build up your monthly income and profits bit by bit.
3. Under Insuring Your Property
You probably set up your real estate company so that your personal assets will not be under attack if someone files a suit against your real estate investment company. Even so, it's still crucial that you insure each one of your properties against all sorts of harm, natural disasters, pipes bursting, and more.
4. Having No Long-Term Investment Plan
Why do you work so hard in your real estate investment business? What is your long-term plan for this business?
Have an exit strategy, so you know how much passive income you want monthly and how long you want to be in this business before you take profits and exit (or hand it down to a family member or offspring). You don't want to do this for the rest of your life, do you?
Real Estate Investing Without Property Managers Is Foolhardy
A bonus tip for you here. Do not make the mistake of running your real estate investing business without hiring property managers. It's a classic newbie mistake, thinking that you will make more money if you did it all by yourself.
Before long, you burn out and you don't even have that much profit to show for it. If you are located in Houston, Texas, Precision Realty & Management is the property management company to hire. You can trust us to maximize your rental's potential.
Contact us today to learn more about our services and how we can help you.