Debunking Myths that stopping you to Enter the World of Real Estate

There are many myths and misconceptions about real estate investing, many with no basis in reality. If you are a newbie investor, you’ve probably heard some horrifying stories about landlords and tenants who failed to pay their rent or flushed toys down the toilet.

Though these stories are often repeated, they are not as common as you might think. In most cases, investing in rental property is a solid investment that performs consistently. These stories tend to stick in memory better, which is why they are repeated so often. While, however, stories about rentals generating income and things moving forward smoothly every month are not as exciting, you don’t hear about them as much.

Is there anything you have seen or heard that has made you reconsider investing in real estate? Do you want to make sure you are making the right decision? Let’s debunk some of the most common investing myths.

Real estate investing is risky

Each investment entails some degree of risk. Real estate investments are, however, less risky than stocks, bonds, mutual funds, gold, etc. When comparing the real estate market and the stock market, it is clear that the stock market is more volatile and less stable. The lack of knowledge has led many people to believe that real estate investments are riskier, but if you do your homework properly, there is no reason to be afraid of investing in property. Real estate gives you the security of having a place to live regardless of the market.

You have to start with a big budget

This is yet another myth about the real estate industry. The amount of cash you’ll need to start up depends on what you’re investing in, but many options have very small up-front funding requirements. A fix-and-flip investment usually doesn’t cost much, especially if you obtain it at auction or through a foreclosure.

If you think creatively, you can bring in a partner to share the costs. When you have a will, you can achieve anything.

Only properties within developed areas are suitable for investment

This is another myth that many people believe when they are planning to invest in real estate. A lot of people always want to invest only in well-connected, well-developed areas. However, properties in prime locations are quite expensive, and prices are already at their highest. Therefore, only a few people can afford to invest in these locations. Thus, you should invest in areas that are likely to experience high growth within the next few years. These areas have low property prices, but they will soon go up. You can get a higher return on investment by investing in suburban areas.

Invest only when the market is good and favourable

Many people will encourage you to invest only in fully developed or well-established neighbourhoods to increase your chances of success. While there is some truth to this, investing in a market that is estimated to grow can offer better returns. However, your revenue might be higher by investing in major metropolises, your returns could easily be lower due to increased costs. Often, city rentals have lower yields than those in secondary markets. Investments in areas that are on the cusp of growth or projected to grow soon can be an affordable way to get started.

Don’t  Invest when you are Young

There is a common misconception that investing in real estate requires a great deal of knowledge and skill and which is why young investors should avoid real estate. They should make this type of investment when they are old enough. However, in reality, the situation is quite different. Investing in real estate at a young age would be a wise decision. As you have plenty of working years ahead of you. This means you can repay the home loan quite easily. Furthermore, once your career grows, your EMIs will not burden your savings. Investing in real estate at a young age is a great decision for a number of reasons. (will add a link to blog here: why youth should invest passively in real estate)

Conclusion

Don’t let these common misconceptions fool you. Make sure to research, and build your investment strategy around the big-picture goals you have. You shouldn’t rely entirely on the advice of a friend or family member. By investing the time into conducting your research, you will discover what will work best for your situation and personal investment journey, which, in the end, will prove to be worthwhile.

In the real estate investing world, there are dozens of ways to make it work for you.

We have compiled a guide to explain everything you need to know about investing in real estate – and made it available to you. To learn more and access your FREE copy, just click here https://bluoceancap.com/ebook/