Top 10 Mistakes First Time Investors Make

Many first time investors never buy more than one investment property  because they make simple mistakes which include: 1) Buying an investment property they would like to live in without thoroughly looking at capital growth and rent return potential. 2) Deciding to buy an investment property close to their owner occupier home rather than looking at investment opportunities throughout their own state or indeed elsewhere. 3) Selecting a property based upon the advice of friends and family rather than seeking independent information. 4) Buying an older property, which can drain finances through maintenance costs. 5) Not undertaking a full assessment of the true cost of buying and holding a property. For example, if the property is an apartment, there are additional cost issues, such as maintenance fees, compared to buying a stand alone house. 6) Selecting the wrong home loan i.e. principal and interest rather than interest only which will help increase cash flow. 7) Buying a property in a location which is not attractive to tenants i.e. not close to amenities such as shops or transport. 8) Purchasing a property in an area where there is an oversupply of properties meaning rents will be low and capital growth rates limited. 9) Trying to select the tenant themselves rather than using the services of a number of reliable property management companies. 10) Buying an investment property with the view to a quick return rather than viewing it as a long term investment and stepping ladder to purchasing a portfolio of properties that will fund their retirement.