When venturing into real estate, one reads and hears all sorts of things, things you should and things you shouldn’t. Meanwhile, real estate investors are coming up with their own rules and formulas to create successful real estate businesses. Real estate investors are ought to dig through available information to find data that they can analyze and choose what works in compatibility with their investment portfolios. Investment property myths are real, whether you like it or not. You must carry your real estate education with your arms to fight off real estate investing myths. Explore all sides of real estate without hesitation until you know what works best for you; it all comes down to making the right investment decisions that will generate enough financial satisfaction to get you hooked.
Investment property myths that you must be aware of
Myth #1: I can’t afford to invest in real estate.
Affordability in real estate is relevant to each investment property and the financial situation of the investor. Most regular people can afford buying an investment property but dismiss it as they are afraid of the consequences that follow the real estate investment purchase. Most real estate investors have found creative ways to generate a revenue and cover the costs of investment properties without going to their pockets to cover property expenses. When you’re looking for any type of property, make sure to select the few that can render a substantial rental income to cover your mortgage payments and other expenses that follow. Most successful real estate investors have pre-set investment strategies in their minds that they use as reference to every investment decision they make.
Related: Where to Invest in Real Estate for Affordable Investment Properties
Myth #2: It is a bad time to invest in real estate.
We all have heard the phrase that it’s a bad time to invest in real estate, but is it really? It’s true that the real estate investment market goes up and down along with the stock market and other variables. On the other hand, real estate investment has proven to be a solid investment choice if the right circumstances are available to achieve economic growth.
This particular myth is not a new one, real estate investors have been hearing it for decades when considering buying an investment property. Imagine prices 20 or 30 years ago. Investing in properties was not as popular as today, and yet people were hesitant to invest thinking it was a seller’s market. It’s a good idea to know the variables to successful real estate investing rather than falling for rumors or certain flawed actions of individuals when making an investment decision.
Related: Easter – The Best Time of Year to Buy a House for Real Estate Investing
Myth #3: Putting your money into an investment property is risky business.
Whether you’re putting your money in a business or in real estate, risk is involved. The solution to that is to leave no room for speculation and guessing. Dig through the nooks and crannies of every opportunity to determine its risks and benefits. If you’re a beginner real estate investor, don’t expect to find low risk investments that easy, you must search and search till you drop. Nothing comes that easy, not even in real estate investment properties.
Myth #4: Real estate investments are for the wealthy.
Simply put, they are absolutely not! There are real estate investors of all shapes and sizes. You don’t need wealth to start real estate investing. Most real estate tycoons were not born with a silver spoon, they worked hard, made wise investments, and reaped the benefits later on. It’s important to know that most real estate investors start out small with what they can afford and develop an investment portfolio solid enough to generate more financing for future investments.
The perfect example for this is income properties, you don’t have to put much cash out of your pockets, meaning you don’t need to be rich to be renting out an investment property. If you play your investment cards right, you can get a rental property with a high rental income to cover your expenses.
Myth #5: Finding tenants for rental properties is hard.
In some cases, this may be true. However, if you conduct a thorough market research and use a rental property calculator to guide you to find the optimal rental strategy, you can avoid all that. A rental property calculator can tell you all you need to know in order to make for a successful investment property by giving you the information you need to decide if you wish to go for traditional rentals or Airbnb rentals. Income properties vary from apartments and single family homes through luxury rentals to vacation rentals. It’s up to you to choose a type that works for your lifestyle and financial situation.
Related: 8 Types of Tenants to Beware of When You Rent Out Your Property
An important metric to look out for when investing in income properties is the occupancy rate. The occupancy rate tells you how many residential properties or houses are occupied compared to the overall properties available. This tells you what the rental demand in the area is like in order to guide you to your destination of financial freedom.
Myth #6: Spreadsheets are the way to assess your real estate investments.
Once upon a time, spreadsheets were the only measuring tool available to measure the viability of the real estate investment decision. Nowadays, technology has seeped through the cracks of everything to reach the real estate industry. Buying an investment property is no more a speculation of what it is; it’s about cold hard facts. Through technology, investment property analysis and comparative market analysis were born. They offer solid information that real estate investors can use to navigate the real estate investment world wisely to find suitable methods to making money in real estate.
Consider using Mashvisor’s investment property analysis tools. It has all you need in real estate metrics from A to Z.
Related: What’s the Use of an Investment Property Analysis Calculator?
Thinking about real estate is only the beginning of your journey in the real estate dream land. Add a pinch of education and a dash of smart financing, you can come up with a real estate investment portfolio that you can depend on. Buying an investment property is not an easy decision to make, and it should not be! It’s up to you to filter out the noise to come up with your own “road to riches” map.
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.