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Too many would-be investors don't end up pursuing their property goals. Here's how to make sure you stay on track.
Blogger: Cam McLellan, director, OpenCorp
Why is it that so many people want to invest in real estate, yet never end up doing so?
I could write a book on this subject alone. Here’s a list of some of the reasons or excuses why people don’t invest:
1. Lack of knowledge and therefore confidence in their decisions.
2. Property management fears, “I don’t want to worry about repairs and maintenance; I’m not getting called at three in the morning to fix a toilet”.
3. Timing the market, “I’m waiting for the market to soften before I purchase”. That may be the intention, but what if the market rises instead?
4. Lack of time. People simply don’t have the time to learn the fundamental principles of safe investing, but more relevant is the fact that they don’t have the time to identify smart investments, even if they do understand the basic principles.
5. Finance. People are not sure how to correctly structure their finance or go about obtaining the right finance. They also seem to feel embarrassed if they are denied a loan the first time they make an application. Never let this stop you, there’s more than one bank out there.
One of the other main reasons I believe some people don’t start to invest is because of all the negative talk out there from people who are too scared to invest themselves. These negative people deploy what I call ‘the nasties’. The nasties are little comments that deflate you. These comments are like cancer; if not cut out they can very easily overtake and kill your desire to break free. If you let any of these people or their reasons stop you investing, one thing is certain; you will retire poor. I’m not saying unhappy, but definitely poor.
There is huge benefit to being able to discuss financial strategy with like-minded people, particularly if they are family. Now most people would say that they love their family dearly, but most families do not have a history of investing. Therefore, even though people may respect their family, if family members haven’t proven themselves as investors, they should not be considered as advisers.
Let’s look at this a different way. If you wanted to bake the perfect chocolate cake, think for a minute on what you’d need to accomplish this. You’d have to mix the right amount of flour with the right amount of water, you’d add an egg, maybe some cocoa, etc. Would you take advice from someone that has never baked a cake before? No, you’d go and find a funny hat-wearing, cake-making chef and you’d decide upon a recipe that has been tried and tested. The same applies to investing; learn from those who have a proven method that works.
Be very careful taking ‘advice’ or ‘tips’ from anyone that has not built a portfolio of property. Basically, don’t listen to them.
Most times when you hear negative talk, people are simply trying to justify why they’re not investing for themselves.
Remember, with these types of people, don’t waste your time trying to change their views, instead just nod and smile.
Stay on track. Stick to your plan with these three tips:
• Don’t take ‘advice’ or ‘tips’ from anyone that has not built a portfolio.
• Block out the nasties.
• Stay on track. Stick to your plan.