Listen up Real Estate Investors!
Avoid These Mistakes Like the Plague
Welcome back for another installment of our Smart Investor Quick Tips Series.
If real estate investors all had 20/20 hindsight, just imagine how many mistakes we could have avoided over the years. Imagine how much money we could have made if we knew ahead of time when the markets would rise and fall.
Well snap back to reality everyone!!
We are humans and are wonderfully flawed. It’s not the end of the world though. We have lessons learned!! Learning from others, or from our own mistakes, is what makes us better and wiser. So let’s review a few lessons learned for real estate investors who are looking for passive returns.
Be very weary of being approached by complete strangers asking you to invest in one of their real estate deals.
Real Estate investors can’s just ask anyone for money when then are raising funds for an investment opportunity. When your money is being pooled with other passive investors, the securities regulations apply. Investors require a certain net worth or income to be participants.
DO make sure you know the rules of investing in your state or province. There are very strict guidelines. Go to the securities commission website in your jurisdiction to understand what is required. In the U.S.A it’s the Securities and Exchange Commission (SEC).
In Canada, you need to contact the provincial regulator/ In Ontario, it would be the Ontario Securities Commission (OSC).
The next tip is DON’T chase the “get rich quick” investments with those “too good to be true” returns. Now, that is not to say you can’t get great returns in real estate. You certainly can. You just need to do your homework .
DO chase the investments that are based on solid numbers, facts and research. Slow and steady worked for the tortoise. And, it can work for you as well. Rome wasn’t built in a day and neither is a solid investment portfolio.
DON’T assume EVERY real estate investment is the same. There are many different ways to invest in real estate. Flips, buy and hold, development, buying notes, etc. Each has their own advantages and risks. So, understand your risk tolerance and invest accordingly. Smart real estate investors are knowledgeable investors.
Want some more do and don’t tips? We got them. Check out our blog below where we reveal more tips.