Deciding to start investing in real estate should come from thorough consideration. You need to know exactly what you are getting into before you regret and backtracking.
Some people believe that real estate is a great start for investing money. However, it is also common for new real estate investors to believe in misguided advice or misconceptions. It is true that there are myths even in real estate business which is a logical deal.
It is great to ask for advice for those successful investors in order to follow the step. However, it is better to follow the truth. The best step to take is to do your own due diligence and necessary research in order to make the right decision.
Here are misconceptions you will find often about real estate business:
- First misconception is that investing in a bad neighborhood is a big no. However, this statement is not true at all. If you can manage to find a potential even in a bad neighborhood then you can earn your profit. Statistically, distressed home prices are 37% below median sales prices. Thee type of properties are typically 20% under the market value. Hence, you can get your chance to higher your profit. You can use flip or buy-and-hold strategy for these properties.
- The next misconception is that you need to be wealthy to invest in real estate. Being wealthy means you have easier access to start investing but it doesn’t determine whether or not you are going to be successful. Statistically, 23% of successful investors started investing in real estate with less than 10,000 dollars. There are various alternatives to start investing in real estate if you have limited funds. Thus, being wealthy is not a must or rule to be able to invest.
- Next common misconception in real estate business is that customer is always right. In business, customer should be treated as a king. However, it doesn’t make them always in the right side. Statistically, 37% of customers do little to no research before investing in a product or service. This results in 23% of them more likely to request a refund. Thus, the best step to handle customers is to give them the best service but still holding on the best principle. Remember that rude customers cost you faithful employees. When you blindly trust customers and give everything they want, your employees will be upset for not having your back especially when the customers become more aggressive.
Those are common misconceptions you will find about real estate business. In order to not be misguided, it is important to rely on facts. Besides, real estate business depends on numbers.
It means you can calculate your steps and consequences easily without believing in unnecessary myth. When it comes to asking for advice, it is still necessary so you can gain more knowledge.
However, it is better to take advice with a grain of salt. Therefore, you can pull your own trigger after doing your own due diligence and research.