We all want to know how we can avoid making catastrophic mistakes when it comes to business. For as much as we may love what we do, ultimately, we’re in it to make a profit. Anything we can do to maximize that profit is advice we want to hear, but similarly, we need to know the potholes that we should dodge as well.
Of course, there are plenty of things that can go wrong with your real estate investment – but there are some that are worse than others. Knowing the blockages that you have to jump over is an essential to making the most of this kind of career, so without further ado…
Some people in this world have a tendency to mistake confidence and hubris as being the same thing. After all, if you’re good at something and confident in your abilities, then what harm can there be in that?
There’s actually a surprising amount of concerns when it comes to over-confidence. For one thing, it can make us extremely sloppy, especially if things have generally gone well for us in the past. We have a tendency to begin to feel infallible after a few successes, which impacts our ability to make rational decisions. Wherever possible, it’s a good idea to try to keep a handle on your thoughts and ensure you’re thinking everything through.
If you see a deal on a property or an opportunity for commercial construction that just seems like too good a chance to pass up, then your instincts will probably tell you to go for it. After all, a deal is a deal, and sure you’d have to borrow to buy… but if you’ve got someone willing to lend and it’s such a good deal…
The above is an example of how your thinking can get out of control. Few of us have the power to resist what we perceive to be a good bargain. We see this effect in action every year when the infamous Black Friday sales roll around and swiftly fall into chaos. We see a deal and we want it, but we don’t think of the consequences of trying to juggle multiple properties when we’re too busy focusing on the deal.
If you make a plan for your investments going forward – as you absolutely should – then stick to it as closely as possible. You planned it that way to give you enough time to focus on each individual deal and property; doing anything but that could be a recipe for disaster.
MISTAKE: Losing Touch
If you are so immersed in the general task of running your business, then it’s far too easy to lose track of what’s happening in the outside world. Even a real estate business can be influenced by forces outside of your control. For example, the sign of an economy that’s struggling is stagnation of house prices, so you need to keep on eye on politics and business at the very least. If you take your eye off the ball, you risk falling behind and losing out to those that are up to date – so always make sure you know what’s happening in the world around you too.