You might have heard about how people these days are making a lot of money from real estate. However, that’s more of a television version which differs greatly from the real version. Chances are, you have fallen for the TV version and desperately looking for a way to invest in real estate and push your luck up. Even worse, you might have already made your first investment, which turned out to be a complete failure. Truth be told, you are not alone. There are several out there who were disillusioned by the whole real estate investment thing and regret their decision each and every moment. But, then what are failures if you don’t learn from them. Here are 5 such real life lessons that one can learn from investing in real estate.
Anything That Sounds Way Too Good Is Far From Being True
There are several out there, who are keen to make a fortune out of a real estate. Chances are they are driven by a truckload of self-motivation books, a string of real estate infomercials and high paid courses that traps guys like anything. Tell you what, everything that you see out there and people rolling in millions after becoming a real estate agent or investing in real estate is nothing but pure breed sweet talk to sell themselves. The key rule being, if you see anything that’s way too good, it’s definitely the opposite. It’s only a matter of time before they fall off the racks when you get to see the real picture behind.
Know What You Love. Love What You Know
Have you ever seen those extremely captivating TV commercials that proactively ask you to invest in real estate to get rich? Well, that could be tempting. The point being, real estate might not be your thing unless you already know your way around the ropes. So, why bother? There is other stuff that you are knowledgeable about. So, stick to what you know and love it.
True Deals Are Never Easy
If the asking price for a property is 12 lakhs and the market data says that it has rent out the potential of 15000 per month that means you are in gain. However, anyone advising you to invest in real estate wouldn’t tell you the story easily. Once you book a property with say 5 lakhs advance; your hard-earned money and then go to your lawyer to discuss the paperwork, he might astonish you saying that you have overpaid for the same. Now, that you have booked the property, it makes all the way more difficult to get the money back from the builder. So, what did you learn? In order to find a bargained deal for a property, you will have to rely on more than the agent and the market data. Since all other real estate investors are keen to work on bargains, chances are pretty bleak that you will find them in the most usual places.
Overpaying For a Property
Ah! This one’s a favorite! You actually end up paying more than what the price of a property is. Always remember, that in order to gain profit from a real estate investment, you will have to shell out way less than the market price of a property. This shall not only fetch your profit but will also add some bit of protection if the property in question incurs charges owing to wear and tear or accidental repairs before you start residing.
Rely On Cash Flow
Cash flow is a critical element of consideration to be successful in your real estate deals. If you are planning to buy a property from reputed builders in Kolkata and would like to rent it out anytime in the future, you will need to make sure the cash flow is planned right. The rent for the property demands to be sufficient to cover your monthly expenses towards taxes, maintenance charges, insurance, leaving a bit of profit to earn from the same. Only then, you have invested rightly in a property. If there’s no cash flow from any property that you want to rent out and possibly stay yourself in the future, it’s probably worthless.
Looking In the Wrong Places
When you are looking to invest in real estate and earn from it, you will need to do a little better than relying on newspapers, TV ads and local agents. Usually, a great property find is one that is being recommended by a similar buyer like you or a dedicated agent who has been showing people around the same neighborhood. These are great sources for zeroing on a property that matches your budget, taste, and desire.