If you are a first-time property buyer, it is obvious you may make mistake and lose money while selling it. Below are some of the common practices seen among many property investors who have failed to make money. It is strictly advised to avoid such errors and buy a property with much planning as you will be investing your hard earned money into it.
Purchasing wrong property
Plan out your property purchase properly. Off-the-plan may turn to be risky. You may land up paying more and when time comes to settle after few years, the bank may value it less comparatively. You thereafter may lose your deposit.
Don’t ignore the fineprints. You may land up buying a cheaper flat that is owned by a company and at the disposing time you may find hard to sell. You may also come across restrictions like how many apartments are allowed to be leased to tenants. Also check whether the apartment block is not subdivided into lots as the owner owns the lot and also holds shares in a company too. Such units are usually worthless.
Investors often buy home at cheaper rates and renovate it by investing further with the intention to sell for good profit, but luck does not favor always. Many have lost money as renovation work became expensive and sometimes errors were made too in structural renovation like extending one extra room was compromised for building a new bathroom and kitchen. While selling the market wanted more rooms than a large bathroom and kitchen.
Often first-time buyers end up paying too much for a property. If you over pay, it will be tough to sell the property later, say after about 4-5 years. You may face a significant loss and may end up with debt too. However, if too many deals fail, it is suggested to have patient and wait for longer period. It will be beneficial.
Purchasing in wrong area
This is one of the main reasons for many who have lost money while selling a property. If you buy a property in the wrong location like the area with little economic prospects or small town without any upcoming infrastructure projects, it may be hard to sell the property.
The above mentioned are just some common mistakes made by amateur property investors. There are some cases with different errors. You may be knowing some. Share your views with fellow readers in the below given comment box.
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