Why To-be Real Estate Investors Fail

Nov 15, 2011 Comments Off by

New real estate investors fascinate me.  Many people I see at my local investment club know real estate is their best investment vehicle. They have read several books on how to buy their first investment property. They are in the process of saving up their first down payment and might be looking for their first property.

I’m surrounded by intelligent people who are professionals like me and are motivated to make more money. These people fail at investing due to a few key factors:

  • loss of down payment
  • stuck at the research phase
  • fear due to listening to fear-mongers
  • lack of action

One of these investors had spent 2-3 years researching how to buy his first investment property. He had attended a Rich Dad Poor Dad seminar and he believed that he was better prepared than most people to get into real estate since he had an “edge”. I asked him when he was going to buy his first property. He said he had to wait another year or two because he spent his investment down payment on the seminar!

Another friend of mine is very intelligent. He thinks things through at a level that would make our brains fry. He had thought about investing but has made no action in planning for his future retirement or home. This guy is stuck in the research phase.

Fear Mongers

We walk among fear-mongers every day. These are the co-workers that tell us now is not the time to buy a house because real estate is not going to grow in the next year or that tenants are going to destroy your property. They mean the best but a true investor will research how to mitigate those risks and how to seek opportunities. Many motivated real estate investors get stuck listening to fear-mongers. I almost fell into this trap.

Lack of Action

The last factor that I see in investment failures is simply a lack of action. One can claim that she wants to be a millionaire by thirty or that he wants to retire comfortably with a chalet on the water and do international travels for half the year. If either person does not start a retirement fund or doesn’t save aggressively for their million dollar goal, money won’t magically appear in their bank account action.

Real Estate

About the author

Clara Cannes, the chief author from Goldeneer is a Canadian that works as a full time employee in the engineering field. Her passion is real estate, entrepreneurship and sustainability. Clara has finally reached financial independence in her late 20's and is on the path to a comfortable retirement by 35.
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