Mistakes to Avoid in Real Estate Investing - Part1

By Adam VanBuskirk

Entering the real estate market as a real estate investor can be a challenge; Receiving funding, getting the residence rented, setting up bank accounts, figuring out how to handle utilities, etc. The list doesn't end. Of course, if one has done their research before beginning, the above tasks aren't near as complicated as they sound. However, often the same mistakes plague new investors as they begin to experience the field of real estate investing instead of just reading about it. Below are five of the top mistakes that people new to the game seem to repeat.

1.) Mixing Bank Accounts - Don't make the mistake of mixing your rental property business with your personal checking/savings account. When people do this, they often end up spending their profits from their rental properties instead of pumping that income back into the business. Then, if a furnace explodes or a roof starts leaking, they have no money to fix the problem.

2.) Letting Tenants Discourage them -If you let them, there will always be a few tenants that will push you around, pay their rent late, complain about everything, etc. DON'T LET THEM! Be courteous with them, but when they get out-of-line, let them know real quick. Often, just as the neighborhood bully, they will immediately step back into place and behave.

Another answer to this very common problem is to hire a property manager. Property managers often work on a percentage of the monthly rent, so if you are making enough money to pay a property manager to relieve you of the day-to-day headaches, do so. Just make sure that the property manager is efficiently managing the property.

3.) Spreading their Properties Out - When investing in multiple properties, keep them close to one another. There is nothing worse then wasting time, gas, and money on traveling to a rental property to fix a leaky sink or mow the grass. It may not seem like a burden at first, but once the excitement of owning the property disappears it can become a major hassle.

4.) Procrastination - This enemy exists in every setting, but is notoriously known for creating literally thousands of will-be-one-day real estate investors. If one finds themselves in the position that they have researched the market, watched the video tapes, read all of the books and still are telling themselves "I will as soon as I get more money" then they are never going to. Don't let fear constrain dreams from becoming reality.

5.) Buying Upper-Class Homes - Don't buy upper-class properties or mini-mansions for rentals. The affluent don't make good tenants because they never stay long. Limit the properties to small, single family homes. These are the money-makers as they tend to attract good, hard-working people that will often rent most of their lives, thus turning the rental property into their long-term home. Also, utilities on these properties will cost less, enticing future tenants even that much more.

Be aware of the above five snags that beginning investors often make. Everyone learns form mistakes, but if one can learn form the mistake by reading it here instead of with their first property, then that’s one massive migraine that won't happen.

The author is the founder and owner of LandLordDocuments.com

This article is free for republishing

Article Source: http://articlealley.com/article_53908_33.html

Adam VanBuskirk


	Mistakes to Avoid in Real Estate Investing - Part1 By Adam VanBuskirk Entering the real estate market as a real estate investor can be a challenge; Receiving funding, getting the residence rented, setting up bank accounts, figuring out how to handle utilities, etc. The list doesn't end. Of course, if one has done their research before beginning, the above tasks aren't near as complicated as they sound. However, often the same mistakes plague new investors as they begin to experience the field of real estate investing instead of just reading about it. Below are five of the top mistakes that people new to the game seem to repeat. 1.) Mixing Bank Accounts - Don't make the mistake of mixing your rental property business with your personal checking/savings account. When people do this, they often end up spending their profits from their rental properties instead of pumping that income back into the business. Then, if a furnace explodes or a roof starts leaking, they have no money to fix the problem. 2.) Letting Tenants Discourage them -If you let them, there will always be a few tenants that will push you around, pay their rent late, complain about everything, etc. DON'T LET THEM! Be courteous with them, but when they get out-of-line, let them know real quick. Often, just as the neighborhood bully, they will immediately step back into place and behave. Another answer to this very common problem is to hire a property manager. Property managers often work on a percentage of the monthly rent, so if you are making enough money to pay a property manager to relieve you of the day-to-day headaches, do so. Just make sure that the property manager is efficiently managing the property. 3.) Spreading their Properties Out - When investing in multiple properties, keep them close to one another. There is nothing worse then wasting time, gas, and money on traveling to a rental property to fix a leaky sink or mow the grass. It may not seem like a burden at first, but once the excitement of owning the property disappears it can become a major hassle. 4.) Procrastination - This enemy exists in every setting, but is notoriously known for creating literally thousands of will-be-one-day real estate investors. If one finds themselves in the position that they have researched the market, watched the video tapes, read all of the books and still are telling themselves "I will as soon as I get more money" then they are never going to. Don't let fear constrain dreams from becoming reality. 5.) Buying Upper-Class Homes - Don't buy upper-class properties or mini-mansions for rentals. The affluent don't make good tenants because they never stay long. Limit the properties to small, single family homes. These are the money-makers as they tend to attract good, hard-working people that will often rent most of their lives, thus turning the rental property into their long-term home. Also, utilities on these properties will cost less, enticing future tenants even that much more. Be aware of the above five snags that beginning investors often make. Everyone learns form mistakes, but if one can learn form the mistake by reading it here instead of with their first property, then that’s one massive migraine that won't happen. The author is the founder and owner of LandLordDocuments.com This article is free for republishing Article Source: http://articlealley.com/article_53908_33.html Adam VanBuskirk
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