Myths That Can Sink New Real Estate Investors

There seems to be a good deal of information accessible out there for real estate investors and a lot of it isn’t acceptable. Knowledgeable investors can usually wade through the misinformation and commercializing hype fairly quickly, usually because a lot of them used to trust in it, bought into it, got bit and learned their lesson. It’s not so easy for young investors, many of whom don’t have anyone to direct them as they venture out. These investors need to be aware of the ocean of bad information that’s out there. They need to know what information is useful and what is nothing but rehashed junk. It’s beyond the scope of this piece to name all the big myths out there, so I will throttle my comments to a few of the greatest, and possibly the most unreliable real estate investment myths that hit new investors right out the door.

It’s So Simple!
No, no it’s not. If it was so unbelievably simple than everybody and their brother would be doing it and raking in a bundle. What we see instead is a lot of people who buy a self study guide, read it and come away thinking that they can become a millionaire in a year or less while only toiling a few hours a week. As insane as it looks when you put it that way, some of these “professionals” make it seem like that in their classes. The reality is that real estate, like anything else that is worth doing, takes work, time and dedication.

You Don’t Have To Spend Any Cash!
Except to buy the several thousand dollars, on average, worth of home study materials they are marketing, obviously. I came across this myth very early in my real estate investing life. Right after the “professional” I was listening to at the time said this, he went on to name different forms of marketing that are required for his systems to work… all of which cost cash!

There is a LOT I could say about this myth, but suffice it to say that yes, you will need to spend some money. You won’t have to spend huge amounts, but there are costs. Remember, there is no such thing as a free lunch!

There’s No Risk!
Anytime you hear an individual say this about something they’re trying to sell you it should make you wary. All forms of investing have an element of chance, but if you work cautiously, increase your knowledge, use common sense and conduct your business honestly you can significantly reduce your risks down to a workable level. Investors that have been working in real estate for years know success doesn’t happen overnight. Seldom do you see investors who have built their occupations using sound methods go belly up.

More often than not it’s the newcomers, the ones who bought (literally) into the idea that they could get rich overnight, who fail at this occupation. The achievers learn how to handle their risks. The losers are the ones who think they don’t exist.

There are many more myths that can trap and potentially sink those new to real estate investing. New investors should study as much as they can from the good, trusted materials that are accessible.

This article is based a chapter of book Be a Real Estate Heavyweight, entitled The 7 Great Lies of Real Estate Investing written by Jarom Adair. For more information on the book, be sure to check out www.RealEstateHeavyweight.com.