Unless you are one of those people who have so much money that losing a few hundred thousand pounds wouldn’t feel like much, then you know just how painful it can be to make an investment mistake. The financial implications alone are enough to make a grown man cry. But, they say that fortune favours the brave.
For that very reason, most property investors keep trying even after catching a bad break. That, however, doesn’t mean that you have to suffer their fate. You can learn from their mistakes and save yourself a bundle while at it. Here are the top 3 mistakes remote property investors make on a regular basis.
Mistake 1: Not taking enough time to look over the property
Maybe it is due to the fact that it is a remote investment or maybe the investor is just too excited about the potential prospects of great returns; something often drives remote property investor into making rush investment decisions. These often turn out to be very costly especially once they find out that the property isn’t exactly what they thought it would be. As a remote investor, take the time to look over the property of interest before committing any money.
But wait a second – aren’t there investors like Rick Otton who pride themselves of buying property abroad without having to leave the country? While it’s true that these people have purchased remotely, without having to visit the place, they do reveal exactly how they are able to do so.
The trick is being able to build a team that can do the necessary scouting for you – and if you do it right, building a team isn’t as expensive as it sounds. So they may not travel to the property physically, but they do know exactly what they are buying.
So even if you cannot do it yourself, have a solicitor who will commission independent property inspectors to give a full report of the status and evaluation before purchase.
Mistake 2: Not thinking of the worst-case scenarios
Any major property investment prospect should be put through a worst-case scenario work up. Think of all the possible angles that could turn things for the worst:
- The market takes a nosedive.
- Your interest rates go up by 2%.
- New taxes and levies come into play.
- The neighbourhood loses value as far as property prices are concerned.
These are all scenarios that could well happen. Take the time to think about them realistically and decide whether or not you could survive the financial hit should any one of the worst-case scenarios come to pass. Only when you find that you can take the blow should you invest in the remote property.
Mistake 3: Not talking to the neighbours.
Property adverts are an excellent way to sell properties. Which also means that sometimes, they are not entirely honest in their valuation and depiction of the property as well as the neighbourhood. Take the time to talk to the neighbours and get a feel for the kind of people they are in general. Talk to the local authorities and find out what kind of crime rate you are looking at. If you can, talk to fellow property owners and get their take on future prospects as far as the region is concerned.
All these precautions will give you a better idea of what you can expect to see in the following years. If everything is looking up and there are good prospects, then, by all means, invest in the remote property.