1. Falling in love with the property
You need to stop thinking like a homeowner and start thinking like a business owner. Yes, you need to like the property; a question you should ask is could you live in it yourself? If you can, then it’s likely someone else can and so the property is probably rentable.
2. No cash reserves
A lack of cash reserves puts unnecessary pressure on you to do substandard repairs, accept substandard tenants or make other poor decisions because of a fear of vacancy. When you have a sufficient cash reserve, you act rationally.
3. Not studying the competition
Why does the guy across the street rent his property the same day someone moves out and yours sits vacant for months? He might not be very picky about whom he rents to, but he also might have lower rents or have gone to extra effort to present the property.
4. Looking for a quick return
Property is long term. It generally appreciates at a steady rate that will give a generous return after a number of years. It is an investment and all investments take time. If you are looking for a quick return, could I suggest Paddy Power’s as you are more likely to be a gambler than an investor.
5. Forgetting to enjoy yourself
It may seem obvious but unless you enjoy what you do it is highly unlikely that you will be successful. Treat your investments as a hobby but with a difference. This hobby will make you money. If you aren’t enjoying it, get out of it, it’s not for you.
