Property investment isn’t just about bricks and mortar. It’s also about psychology.
New investors often make mistakes because they start out with the wrong mindset. You can avoid many of these pitfalls by simply shifting your perspective.
Have a long-term vision
Thinking that property investing is a way to get rich quickly can set you up for failure. Sure, investing in property is a great way to achieve financial security. But the road to early retirement isn’t as easy as you may think.
Property investing is a long game with many highs and lows along the way. You need to be able to keep your eye on the goal, which could be decades into the future.
Accept that there will be risks
Property may seem like a safer investment compared to some other investment strategies, but it isn’t without risks. You need to accept the reality of risk but be smart enough to take calculated risks. If you do your research and due diligence, you’ll be able to sift bad properties from good ones.
As you become more experienced, this will become easier. You can also work with a buyer’s agent who can guide you in buying the right properties.
Anticipate market fluctuations
Many rookie property investors panic at the first sign of a market dip and sell their properties. This is a mistake. Historically, Australia’s housing market has gone through price cycles, with both ups and downs. But history shows the ups have outweighed the downs.
That’s why seasoned investors don’t panic but ride it out. They know the market rises and falls but understand that, over time, it stabilises and grows.
Block out noise from the media
The media can throw you off your game with speculation and incorrect or unsubstantiated information. If you want to keep your finger on the property pulse, educate yourself on the property market and seek advice from a property finance expert.
If you do follow property news, make sure it’s from a reputable media source, property company, or based on credible statistics.
Keep emotions out of it
Remember, you’re not buying a property to live in. This is a business transaction. Don’t let your personal emotions override sound business decisions and don’t succumb to worst-case-scenario fears. The best investors are ambitious and optimistic while remaining calm and rational.