What do you think is the biggest mistake that new real estate investors make? If you ask a dozen real estate investors, you will most likely get the same answer from the vast majority of them.
“They paid too much for their first few houses”
By and large this is the #1 mistake most of us made when we were brand new. We just didn’t know what a good deal was. (We thought we did). It was typically later down the line we realized that we had paid too much for the house.
So how can you keep from making the same mistake?
Do Your Homework
Don’t try to be an expert on every neighborhood. Invest in areas that you know. If you aren’t really that familiar with any areas and their home values, then it’s time to get some education. Do some research and choose an area to work in or to “farm”. Here are a few tips for you that will help you learn the area:
If you want to know how much they paid for the house or how much other houses are valued at in the area, I would suggest you get a subscription to your local PVA or tax assessor’s site. In my city it only costs $25.00 per month.
Learn From Experienced Investors
If you don’t already belong to your local REIA (Real Estate Investors Association) you can find one in just about every major city. Once you find the one that is nearest to you, become a member and get involved. This is where you will find your first mentors. Get there early and hang out with other investors. You will be surprised at just how willing they will be to help you succeed. If you don’t know where your nearest group is you can find one here at http://www.nationalreia.com/.
Don’t forget to give back to all those folks that have so generously shared their knowledge and experience with you. Volunteer to help out at the meetings. They are always looking for folks to do those “less glamorous” jobs like manning the sign in sheet. This job is a great way to meet the members.
Invest In Your Education
All successful people are lifelong learners, and real estate investors are no different. Commit to being the best that you can be. Make a commitment to yourself to spend one hour each day learning. There is a wealth of information out there that is free just for the taking. Visit the popular real estate investing blogs and forums. These are great places to learn, and you will find investors at every level of experience. Check out books at the library, and get to know other investors online. You can find them easily just by doing a search. You don’t need a lot of cash initially to get started with your education.
One Final Tip
As soon as you can afford it, get a coach. There are great coaches that don’t cost a lot of money. These experienced investors can shave years off your learning curve and can keep you from making some costly mistakes.