What do you suppose is the #1 newbie mistake is?I’ll bet if you ask a room full of real estate investors, you will get at least a couple of different answers. But by and large, you will hear the same thing over and over.
“They paid too much for their first few houses”. Just about everyone I know did this in the beginning, myself included. It’s a common mistake new real estate investor’s make. So how can you keep from making this same mistake?
First and foremost, you have to learn what a good deal is and this comes with experience. However, there are things you can do to speed this process up.
Don’t try to be an expert on every neighborhood.
Pick one area and become an expert on that area before moving on to another one. Visit open houses on the weekends and find out what houses are selling for.
Talk to other investors in the area. If you are driving around the neighborhood and you see a house that’s in the process of being rehabbed, stop by and talk to the owners of the house. Find out what they expect the house to sell for.
Call for rent signs in the neighborhood and get some input from the folks that have been around a while. Landlords know what their houses are worth.
If you have access to the MLS you can quickly find out what property values are for any area.
Learn from those that came before you.
When you are just starting out you should belong to your REIA group. Be there at the next meeting! There is one in every major city. You can find the one nearest to you by visiting http://REIA.org or http://nationalREIA.com.
Get there early and hang out with those folks. You’ll be surprised at just how willing they are to help you succeed. If you’re having trouble putting together an offer; if you’re just not sure it’s a good deal, ask someone that’s experienced.
Be sure to give back to the people that so generously share their knowledge with you. Volunteer to do one of the less glamorous jobs at the meeting no one else wants to do like manning the sign in sheet.
Hang out online where the experienced investors are.
There are so many places online that you can ask questions, get information, and get advice that will keep you from making mistakes. There is a wealth of information on real estate blogs and online forums.
One of my favorites is http://BiggerPockets.com. It’s free and you’ll find investors at every level of experience from all parts of the country.
Invest in your education.
All successful real estate investors are life long learners. Commit to becoming the best you can be. Make it a part of your life to spend some time each day learning how to be a better investor. There are so many books, tapes and seminars that don’t cost anything, but be prepared to invest some money along the way in your success. You’re worth it!
Believe in yourself.
Develop a strong belief that you will succeed and then take action each and every day. Small consistent steps lead to big accomplishments.