26 April 2012
The 10 BIG Property Mistakes that can Financially Ruin You & How to Avoid them for Profit & Longevity – Part 2
Mistake #6– Over killing on the Refurb
If the property requires some sort of renovation, try to do the minimum. Do not get drawn in by the TV programmes, where the selling price is overestimated, and the time and cost of the project are both underestimated.Factor in your profit and loss AND account to see if the project is really worth your time. Also remember that a refurb to rent needs FAR less work and expense than a refurb to sell!
Mistake #7 – Getting emotional about the numbers
The numbers never lie. Do not get emotional over property as this will cost you money. And cause you pain. Don’t chase the deals; let them come back to you. Play the long game – we had a deal that we recently exchanged that we have been negotiating on for 2 years that fell out of bed 3 times! This is not uncommon, and far better than trying to tie a price up too early and getting too emotionally involved and ‘wanting to get the deal done.’ Beginners are especially susceptible to this.
Have a strict set of rules and do not deviate from them. If the numbers do not work for you, don't think they won't for another investor. Consider selling the lead on/packaging the deal up. Maximise your revenue streams!
Mistake #9 – Selling your Property
If you have read our first book, ‘The 44 Most Closely Guarded Property Secrets’ you will know we bang on quite a bit about you make your money when you buy…
and not when you sell.
The reason we believe selling is a mistake is because you are transferring your wealth to someone else. You are slaying the goose that is laying the Golden eggs.
Now, we do believe that IF your property is not performing well, or you have bought a property out of area or you can flip a low yielding property on a quick turnaround, then selling the property to reinvest in another better performing property project or to get out is a viable strategy.
The mistake we often see is investors not investing for the long term. If we go by past property cycles, and property prices increasing in value over time, then continually selling your properties reduces your asset base and long term wealth
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