Manage the Speed of Your Investment Career
New real estate investors suffer from a lack of experience in real estate investing and that lack of experience can often lead to problems that become discouraging at the onset of an investment career. Just as it is important to balance the amount of knowledge and experience you take into the real estate investment industry, it is also important to manage the speed of your investment efforts, especially early on.
Case 1: The Eager Investor
The eager real estate investor is someone that is brimming with knowledge about the real estate industry, common investment techniques, pitfalls to watch out for and method to scrounge up the best leads possible for potential investment opportunities. Armed with all of this knowledge, they make the leap quickly into an investment property to try out all that they have learned.
However, sometimes that leap comes too quickly and an eager investor is quickly schooled in the art of selecting an investment opportunity. In some cases, there is no amount of schooling or gumption in the world to solve an investment opportunity that was broken from the beginning. Just as young people can sometimes feel that they are invincible, sometimes young investors feel that effort and research will always be enough to save a transaction. That is not always true.
Case 2: The Cautious Investor
The cautious investor is perhaps the direct opposite of the eager investor but equal in terms of results. Instead of jumping at the first investment opportunity to come his or her way, the cautious investor instead continues to evaluate new opportunities against old ones, comparing and contrasting almost endlessly in the pursuit of the perfect situation or the ideal investment opportunity.#idx-price-bar#
The fact is, those perfect situations are rare in the real estate investment world and waiting for them to come along can leave one waiting for a very long time. There may be no investment that fits every aspect of your search criteria and there is certainly value in taking the plunge with an investment that might not have every positive aspect you look for, but shows off enough positive traits to warrant the risk.
Find Your Speed
For both cases, it is finding the balance between the two situations that is difficult and while it may be tough to nail down, it will ultimately yield the best results. Instead of jumping at the first opportunity you see, research a handful of viable projects, sorting out the best ones and jumping on the one that you feel best about. You may feel like you are wasting time and not putting your talents to use, but part of your talent should include the evaluation of properties. Getting started is often the most difficult, most important step and certainly not something to rush through.
Instead of constantly reevaluating opportunities and never finding the perfect one, make a list of pros and cons to decide from and take on the challenge that presents the greatest amount of positive attributes, even if there are some cons to be dealt with. This is how investment in any industry takes place and waiting for a perfect deal can be just as detrimental to an investment career as jumping on whatever comes along.
Excitement and eagerness certainly have their places in investing and this piece of advice is not meant in any way to discourage potential investors from getting exciting about what months of knowledge and training can do in the real world. Instead, it should be taken as a word of caution to those at both extremes to strive greatly for the middle ground. The most successful real estate investors in your area will tell you that balancing risk and reward is a recipe for success, in any field.