If you’re looking to expand your investment portfolio into real estate, there are now some incredible opportunities to do so. But there’s also a lot at stake, so it’s important to be well informed and avoid the common mistakes that could derail your long-term success.
By Gabrielle Olya
- Trying To Do It Completely on Your Own
- Buying in Inopportune Locations
- Flipping Homes in the Current Real Estate Market
- Mismanaging Your Money
Kuba Jewgieniew, CEO of Realty ONE and a pro in the field with over 16 years of experience in the real estate industry, said that these are the biggest mistakes new real estate investors can make.
1. Trying To Do It Completely on Your Own
“If you want to jump into real estate investing in today’s market, I urge you to jump in with a mentor — someone who has done it before,” Jewgieniew said. “Get your feet wet, get some experience so you don’t get burned.”
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A mentor can help keep you on track and focused on the long term.
“When investing in real estate, the goal is to build wealth — but building wealth happens over time,” Jewgieniew said.
2. Buying in Inopportune Locations
When it comes to real estate investing, location matters and it’s important to think about the long-term potential. To get the most bang for your buck, avoid buying property someplace based solely on the fact that it’s located in a “hot” market. Instead, be strategic.
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3. Flipping Homes in the Current Real Estate Market
Although flipping homes is a popular way to cash in on your real estate investments, Jewgieniew advises against doing so in the current market.
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“Do not try to buy homes to flip right now,” he said. “A year ago, I would have said something different, but do not try to get in and get out quickly. That’s not the game to play right now. Buy it and hold it long-term, and focus on cash flow.”
4. Mismanaging Your Money
It can be easy to get caught up in the excitement of real estate investing, but it’s important to take the time to do the math and make sure that your cash flow is positive.
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“Don’t mismanage your money,” Jewgieniew said. “If you want to get in on real estate investing, I would, No. 1, suggest doing the math and seeing when you’re going to cash flow with two factors: interest rates and vacancy rates.”
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