There are many property investment myths out there that deter potential investors and popularise disinformation. Being aware of them can better help you understand property investment, and your goals.
Here are 5 of the most persistent myths exposed:
MYTH #1- ONLY FOR THE RICH
To be clear, you do need money to invest in property but less than you might think. There are a few well-known and alternative options available, so that you can finance your investment.
A joint venture with an experienced investor who is ‘cash rich but time poor’ is a way to get started, and a means of learning more about the property industry.
It isn’t the only way, though, with other tried and tested methods, such as: bank loans, using the equity in your own home, buying off-plan, or the much newer option of crowdfunding.
Remember, as well, that you don’t have to start out ‘big’ with your first property investment, you can begin with smaller investments, such as: units, apartments, or townhouses. Once you are earning an income, you can then use it to obtain other properties and build your portfolio.
MYTH #2- NOT RIGHT TIME
When is the right time? If you’re thinking of investing in property, take a leap and go for it.
Sure, the world around us is always changing: prices, mortgage interest rates, taxes, and government policies are not static.
To be able to deal with any uncertainties, rises, or downturns; it’s essential to form a strategy suitable for market conditions, and to take advice. If you do so, your investments will often be successful.
Going ahead with your investment is always better than waiting for a mythical ‘right time’, as there is no ‘bad time’ to invest in property. In the UK, demand far outstrips supply, which is unlikely to change anytime soon; people will always need homes.
MYTH #3- GET RICH QUICK SCHEME
If it was so easy to earn vast amounts from property investments over a short period of time, wouldn’t we all be doing it?
Making a success of your investments and building a profitable portfolio does not happen overnight.
You can only get the best out of your property investments if you put in the time and effort required. Do your research, network, and most importantly build a system that you will stick to and can amend if required.
Like any venture, property investment requires: hard-work, patience, dedication, and the ability to pick yourself up after being knocked back.
MYTH #4- ONLY INVEST IN FAMILIAR LOCATIONS
If you’re just investing in a property to look at it or to visit regularly, then may be only investing in your local area is your best option. Though, you would be limiting yourself and locking yourself out of areas that could potentially provide higher returns.
Look beyond what you know, research: capital growth trends, rental yields, vacancy rates, and average times to sell in areas further away.
MYTH #5- YOU HAVE TO DO IT ALONE
Not at all, but if you want to go through with your property investment alone, that’s entirely up to you. However, before you make your decision, ensure you know what you want to get out of your investment property, and that you are not overstretching yourself.
Otherwise, there are several sources and professionals that can assist with your investment, including: investment advisers, mortgage advisers, letting agents, and financial advisers.
Seeking out other professionals, could be the best thing you do, as they may be able to identify opportunities you hadn’t considered or did not know of.