Are you someone who has just started investing in real estate? Is it that your first few investments did not give you any return? Are you struggling to make a profit on your deals? If that’s the case, you have to listen to the best experts who have been doing it for years and decades. Lior Babazara, a real estate investor for years, can explain to you why your real estate investments are not giving you a good return.
According to Lior Babazara, there could be many reasons that are causing this failure on your part. However, the last thing you want to do is to blame the market. If you look around, you will definitely find many others who are making money on their deals. So, here is what Lior Babazara has to say about your real estate investments failing.
You Are Relying on One Market
When people decide they want to invest in real estate, they start with the local market. When you take a survey of your city, you find out that there are hundreds of new real estate projects being developed. You like one of the projects and you invest in it. Your first investment does not give you any return and you invest again in the same society. That’s where you make a big mistake. You should explore other projects. Don’t just a project by how it looks from the outside. Make sure you go inside and get a detailed view of the entire area.
In addition to that, you should not limit yourself to the local market anymore since you can now invest in real estate using online methods. Rather than directly buying properties, you can invest in several projects with small amounts and accumulate small profits to earn a big sum every month.
You Are Too Focused on the Property
There are different types of investors. Some like to deal with plots and vacant lands while other prefer to buy and sell built homes. If you are the latter kind and you can’t get any profits from your sales, you are probably focusing on the property too much. When you buy a house and sell it back for profit, you have to look at other things than just the property. For example, after seeing the exterior and interior work of the property, you might think it is worth $250,000. However, you will come to a different conclusion once you survey the area.
You might find out that the best property in that area is prices at $175,000. With that in mind, it makes no sense for you to buy a property at $250,000. It does not matter how many exotic materials have been used in the construction of a house, it still cannot be priced more than its market price. Lior Babazara says that you must not let the property enthrall you. Survey the area and you will surely know the truth.
You Are Aiming Too High Too Early
According to Lior Babazara, this is the mirage effect i.e. you are seeing something that’s not there. In his opinion, some people are not failing at all. Instead, they are not getting the profits that they had expected. In other words, their expectations are unrealistic. If that’s the case with you, don’t let this ruin your real estate investment career. When you start in this market, you keep your profit to a minimum. You then make a name for yourself and become a well-known person in the circle. Once that happens, you can charge not only to cover the cost but for your brand’s value as well.
Final Thoughts
This is the reason Lior Babazara says you should only invest a small portion of your money in real estate or any other market for that matter. While real estate is one of the best performing markets in the world, you still have to prepare for a loss. Last but not least, don’t enter a market with unrealistic expectations.
