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Avoid rookie mistakes: How savvy investors build lasting portfolio
While all investors are bound to make mistakes, steering clear of rookie errors can prevent setbacks and protect long-term wealth growth, according to a seasoned property expert. Here’s how to avoid the most common pitfalls.
According to Hotspotting director Terry Ryder, having a clear mindset and a knowledge-driven strategy are essential to new investors who aim to build their portfolio and wealth.
In his new book, Why Property Values Rise, Ryder said that many of the new investors' setbacks are due to poor planning skills, lack of data-based knowledge, and emotional decisions.
Additionally, he said that many buyers have been limiting themselves to their local area, yet strategic investors ignore proximity, focusing on potential and treating all of Australia as their market.
“Smart investing starts with smart planning. Time in the market beats timing the market, and no one ever got rich following the herd.”
“Too many people treat property investment like a weekend hobby, but if you want to succeed, you need to treat it like a business – one that demands planning, patience, and professional advice.”
Avoid rookie error 1: Get the right first property
Ryder said investors who make the wrong first property purchase often face stalled progress, as it can sharply limit returns, slow long-term portfolio growth, and may take years to recover from.
“Smart investing starts with smart planning because your first property isn’t just a purchase; it’s the foundation of your future.”
“If it doesn’t pay its own way, grow in value, or preserve your borrowing power, it can scuttle a 10-year strategy."
Avoid rookie error 2: Make sure to have a plan
Ryder said that many investors rush into buying without proper planning, often guided by emotion or advice from others; this results in poor decisions, financial strain, and lost opportunities.
He noted that most first-time investors skip the essential early steps of strategy and research, jumping straight to property selection, which is why they often fail.
“I have eight property investment steps, but most people start at step seven – looking for properties – without doing the first six first.”
“They skip the strategy, ignore the research, and dive in based on emotion or hearsay. That’s why so many first-time investors fail.”
Successful investors have been managing their portfolios like a business, not a weekend hobby, planning carefully according to their goals.
“Smart investors start with goals, build a team, and develop a plan. Only then should they look at listings.”
Avoid rookie error 3: Invest in knowledge and advice
According to Ryder, to grow their portfolio and manage it as a business, seasoned buyers have been investing in property education, expert advice, and quality research.
New investors have been reluctant to invest in themselves, yet without fundamental knowledge, buyers may make emotional decisions, choose poor locations, and experience long-term regret.
“Too many people are willing to spend $500,000 on a property but won’t spend $150 on a research report to make sure they’re buying in the right location.”
“You can’t penny-pinch your way to success in property investment.”
Avoid rookie error 4: Take action, stop procrastination
Ryder said that new investors often have difficulties putting words into action, leading to long-term regrets.
Procrastination has proven costly in real estate, as waiting for ‘better’ market conditions often results in missed opportunities.
“They’re always waiting for the perfect moment, but in property, hesitation costs money.”
“Real estate is a long-term play. The market will always have noise, but the reasons property values rise don’t change.”
Avoid rookie error 5: Don’t follow the herd
Ryder cautioned new investors against following the crowd, emphasising that genuine success in real estate comes from thinking and acting independently.
He cited past market frenzies, like Gladstone’s gas boom and Perth’s post-2024 surge, as lessons for inexperienced investors.
“Investors who rushed in without research or expert advice often paid too much for poor-quality assets. Meanwhile, the well-informed minority who bought early reaped the rewards.”
“In property, the people who think and act independently are the ones who win. No one ever got rich following the herd.”
“The smart money moves quietly, long before the headlines catch up. Excellence often hides at the edges.”
Avoid rookie error 6: Don’t react to media soundbites
Ryder said successful real estate investors rely on careful analysis rather than impulsive reactions, with thorough research forming the foundation of smart decisions.
He added that looking beyond headlines has become essential to understanding the whole market picture.
“If you’re making half-million-dollar decisions, don’t base them on soundbites.”
“Dig into the data, seek independent insights, and stay informed.”
Avoid rookie error 7: Expand your horizon
According to Ryder, another common rookie mistake has been to limit property searches to one’s local area, relying on familiarity or emotional reasons.
He advises investors to view all of Australia as their potential market and focus on where it’s a good time to buy.
“Emotional rationales, like wanting to drive by the property or relying on local familiarity, often lead to poor decisions.”
He said that many buyers who think they “know their market” often cannot answer basic questions about vacancy rates, rental yields, or price trends.
Avoid rookie error 8: Diversify markets
Ryder said single-industry towns may see short-term property gains but rarely provide sustainable long-term growth.
Mining, tourism, and rural markets often experience spikes followed by steep declines, leaving investors exposed.
“Mining towns, tourism towns and country towns have a lot in common.”
“Their real estate markets sometimes have growth spurts, but the growth is not sustainable. Long-term, they don’t deliver and far too often, they are a graveyard for investors’ money.”
Even agricultural towns have seen dramatic price drops, reflecting that low prices often signal underlying risks.
“These locations are cheap for a reason.”
Avoid rookie error 9: Don’t put all eggs in one basket
Another rookie error new investors make is focusing on one specific state, economy, or asset class.
“It’s never smart to put all your nest eggs in one economic basket. That’s for basket cases,” Ryder said.
“Smart investors spread their holdings across multiple markets to protect against downturns and maximise growth.”
He said that Victoria’s underperformance from 2022 to 2025 illustrates the risk of market concentration, as investors faced falling values, high taxes, and strict rental laws while other cities surged.
Avoid rookie error 10: Accumulate, don’t trade
Ryder said that investors wanting to build real wealth in real estate should focus on long-term accumulation rather than short-term trading.
“All the truly successful investors I’ve known are collectors. They build portfolios, not trading histories.”
He said that selling frequently erodes gains through capital gains tax, commissions, and other costs, while equity growth compounds returns for future purchases.
“With equity growth enabling future purchases and compounding returns, investors must shift their mindset.”.
The most successful investors are patient and focus on portfolio growth rather than flipping properties.
“Real estate rewards patience. The best investors don’t flip – they accumulate.”
Avoid rookie error 11: Hold onto your properties
According to Ryder, another common mistake new investors make is to underestimate how long they should hold onto their property to create lasting wealth.
“Real estate rewards those who stay the course. Yet many investors exit after just a year or two – often before their property has had a chance to perform.”
By doing this, investors will miss the long-term compounding benefits of holding real estate.
In 2024 and 2025, rising ownership costs pushed many landlords to offload properties prematurely.
“Selling early might feel like a win, but it often cuts off the compounding benefits that come with time.”
Avoid rookie error 12: Continue to stay informed
Ryder said one of the most costly mistakes investors make is switching off after purchasing a property.
Many buyers believe their work ends at settlement, but serious investors must stay informed and engaged.
Ignoring market trends will force them to start the learning process all over again when they wish to buy their next property, losing the advantage.
“Too many buyers think the job is done once they’ve settled. But if you’re a serious investor, you can never tune out. You must stay informed.”
“Property investment is a journey, not a transaction. Staying connected to credible research and expert insights is essential – whether you’re buying your first property or your fifth,” Ryder concluded.
