The real estate industry is very lucrative only if it is done properly. It is possible to become rich in the market but it won’t be easy. Most real estate investors make certain mistakes that result in losses. Avoiding the following mistakes can help you make money in the real estate industry.
One of the biggest mistakes most first-time real estate investors do, is paying too much on a property. The essence of any investment is buying at a low price and selling at a higher price. Therefore, you will only make money in the real estate industry if you get a property at a good price. However, if you buy a property at a higher price, your investment on return will be significantly affected because the property will appreciate very little. In some cases, you might even make a loss
2. Lack of a good understanding of the market
This is another major mistake most real estate investors make. Understanding the market means more than just knowing the neighbourhood. You have to understand the underlying demand of the particular market you intend to invest in.
For instance, if you like investing in the off plan property in Dubai, you will not be successful if you don’t understand the market. If you want to resell, who are the potential buyers? You should understand what the potential buyers are looking for.
The off-plan market is one of the latest trends in the Dubai real estate industry. Some of the top developers are getting involved in the off-plan market. For example, there are several Meraas off plan projects in Dubai such as Sur la Mer townhouses. If you are interested in completed projects, there is a rich selection of apartments for sale in Palm Jumeirah where you can invest and expect a high ROI.
3. Failure to do Due diligence
Before you put your money on any property, you must be willing to go an extra mile to perform due diligence. The failure to research on the property, the neighbourhood and the market in general is an intolerable error that may cause loses. However, it is a mistake most real estate investors make and they end up stuck with a property that is a money loser.
4. Lack of strategy
Having a transactional view of the real estate is another mistake some investors make. Like any other type of investment, you need to create a plan and stick by it. If you don’t have a viable investment plan, you might make a mistake of buying the wrong property just because you were offered a good deal.