4 MISTAKES TO AVOID AS A BEGINNER REAL ESTATE INVESTOR

As a beginner real estate investor you’ll face a lot of challenges. A decade in the real estate industry has taught me that experience is definitely the best teacher. Mistakes are bound to happen.

Today I would like to share four common mistakes that, if not avoided as a beginner real estate investor, could negatively affect your business. You’ll also be provided with solutions to these mistakes which will steer you clear of trouble, and help you achieve the results you want!

Choosing the wrong tactic

I have had the opportunity to do a lot of coaching for beginner real estate investors over the years. One of the biggest mistakes I see new real estate investors make is their choice of tactic.

Every investor’s personality is different. The successful real estate investors are the ones who accurately pair their personality with the tactic that works best with it.

For example, whole selling requires patience. Waiting for deals to close and searching for buyers once you’ve bought a house requires patience. If you have a “go go go” mentality then whole selling wouldn’t be the best choice.

Another example would be flippers. Investors who buy, fix and sell houses normally have very little patience and a go and get it attitude. They also enjoy all of the control, whether it’s being involved in the deal from start to finish or managing contractors.

As a beginner real estate investor you need to ensure that when choosing a tactic you:

• Determine what kind of personality you have
• Research what type of investing will work best with your personality
• Start putting together your business plan

Right tactic, wrong location

While the phrase “Location Location Location” is often attributed to property value, it’s also one of the most important factors for getting your real estate business up and running.

As a beginner real estate investor with the right tactic, making sure your tactic will work in your location can be one of the most challenging obstacles to overcome. It is important to keep in mind that the tactic that works best with you may be more effective in different locations.

A good example is the flipper market in Atlanta. It is harder for me to do a 100k all in flip in Atlanta than it would be in Chicago or San Antonio. Different parts of the country, and even different parts of states, have different housing markets.

What can you do to make sure your tactic will work in your location? Keep up with market analysis. Stay up to date with what houses are selling for in your target market. Although the housing market has leveled off in most areas, it never hurts to know what the current trends are and where they are.

For a beginner real estate investor, defining how your business will be different is another part of making sure your tactic is effective. The real estate market is flooded with investors all competing for the same properties. Really defining your personality and services early will help you attract more business and set you apart from the pack.

When figuring out if your tactic will work in your location

• Do plenty of local market research
• Make sure that your marketing (business cards, web site, blog, flyers) are pull of your personality
• Highlight what sets your business apart

Short of moving to a city where your tactic will work best, following these tips is the best way to get your real estate investor business working, and working successfully.

Avoid shiny object syndrome

Another common mistake that beginner real estate investors make is succumbing to Shiny Object Syndrome. This is when you pinball from one strategy or tactic to the next, preventing success.

If you are going to be a real estate investor who flips houses and you specialize in foreclosures, develop your marketing plan around that and stick to it. Chances are if you have matched a tactic to your personality, you’ve determined your target market in your location, and you have marketing already ordered, you have a plan. Give your plan time to work!

Inconsistency is the fastest way to prevent success. If you have taken the time to develop a plan let it work. Evaluate your plan monthly and then quarterly. Constantly tweak it and make improvements. Whether you are a house flipper, a whole seller, or a foreclosure specialist, developing and growing your business takes patience.

Analysis Paralysis

Analysis Paralysis can happen to anybody, from beginner real estate investors to seasoned veterans. Common symptoms include inability to make decisions, over analyzing all deals that come your way and an “I can’t find deals” attitude.

If you have run your comps, estimated repairs and have a closing date in mind, then make the offer! The bottom line is if you aren’t making offers, then you’re not making money. In this industry, 30 seconds after deal analysis is done offers are being made and deals are being sealed.

The more deals you pass up on due to analysis paralysis the easier it is to develop the “I can’t find deals” mentality. As a beginner real estate investor you CAN NOT LET THIS HAPPEN. Develop a plan, have faith in that plan, and give your plan time to work.

Combat analysis paralysis by

• Quickly analyzing deals and having faith in your analysis
• Make offers
• Have a plan and have faith in that plan

The four factors above all prevent success for beginner real estate investors. I can tell you that these are lessons that are most often learned through experience. However, if you take the lessons in this post on combating these four mistakes and apply them, you WILL see results.

Choose a tactic that suits your personality, apply that tactic to a researched target area, give your strategy time to work and most importantly, make offers. You are just starting your real estate investor career, take these steps to ensure that you have a solid start and achieve the results you want!