Eleanor Roosevelt once said:
“Learn from the mistakes of others. You can't live long enough to make them all yourself.”
I am a firm believer in mistakes. Instead of seeing them as failures, I believe that mistakes are valuable life lessons.
However, I don’t believe that all mistakes are necessary. In my mentorship program, I tell my students that if they’re going to make mistakes, they should make them quickly and learn from them.
But I also show them how to avoid making some of the bigger, career-ending mistakes that I made when I first became a real estate investor.
Today, I’m going to share the top 5 worst real estate mistakes I’ve ever made- and how to avoid them:
Having the wrong mindset
I’ve spoken about this before, but it never gets old: Real estate investment is a mental game.
If you don’t have the right mindset, you will never become a successful investor. When I first started to invest in property in South Africa, I had a scarcity mindset. I had limiting beliefs that prevented me from seeing the bigger picture.
With the help of my mentor, I realised that I needed to change my thinking. So, I did.
I started investing in faith, which helped me to plan for the long-term instead of the short-term. This simple shift completely changed my mindset.
I was no longer afraid of losing money or making the wrong business decision; instead, I was confident that I could accomplish anything.
Trying to do it all
When I was first introduced to real estate investment in South Africa, I tried to do it all.
Instead of niching down and becoming an expert in one real estate sector, I wanted to do them all. Have you ever heard the saying:
“Jack of all trades: master of none”?
Well, that’s what I was. Not only was it frustrating, but it led to wasted time, money and effort.
Don’t do what I did. Instead, educate yourself. Pick a niche and learn all you can about it. Then start to invest.
After I chose my niche, I went from managing 35 beds in a student accommodation to managing 120 beds within 3 months.
Jumping into deals too fast
Do your due diligence. Nothing is more important.
When I first began to invest in real estate in South Africa, I was easily distracted by shiny things. When I deal looked good, I immediately wanted to snag it.
However, I quickly learned the importance of doing my research after I got burned a few times.
Whatever you do, don’t jump into deals too fast.
Always do thorough research and perform due diligence first. If you want to sign a contract quickly- or are being forced to- don’t worry. You can just include a clause in the contract that will allow you time to do your due diligence.
Relying on bad advice
So many people are self-proclaimed real estate investment experts. However, few actually have the skills and knowledge to back it up. Alternatively, friends and family always want to give business advice. At least, mine did.
But the truth is that when most people give advice, it’s based on their own opinions and fears. Oftentimes, this can cause you to develop limiting beliefs.
One of the worst mistakes I made- and one that I made several times- was relying on bad advice.
Of course, I didn’t know that it was bad advice at the time.
When it comes to real estate investment in South Africa, the only person you should take advice from is your mentor.
You need advice from their experience and results- not someone else’s opinions and fears. Ignore anything that your friends and family members have to say if it can’t be backed up by your expert. And steer clear of fake news!
Some real estate investment mistakes are inevitable. However, many are avoidable. What are some real estate investment mistakes that you have made?