Probably the most asked question by a novice investor would be one about how to avoid failing at real estate investing. This question, in its' many shapes and forms is the root of all fears in the property investing game. Losing money in any real estate investment is a scary side effect of bad advice, improper planning, or bad deals brought by unscrupulous scammers interested in parting the novice (and veterans, too!) from their hard earned cash. So what is the best way to learn how to avoid failing at real estate investing? The beginner needs to understand why others fail and what to do-or not do- to sidestep these pitfalls.

Probably the worst mistake that a novice can make is to try to do everything themselves. In the beginning, the new investor should speak with a mentor in his or her local area to learn the market. This real estate investing mentor will walk the new investor through a first deal or even later deals. A mentor has experience and can help by letting the novice know what he or she can do on their own. Some cities and towns have guidelines or codes that a home cannot be improved without a licensed contractor performing the work to ensure the safety of the home for buyers. If a new investor tries to perform the work that the local government has stated that a contractor must do, a fine can ensue.

Fines are not the only pitfall. Excessive cost of rehabilitation can drain the finances of an investor, leaving a bad taste in their mouth for any future investments. Some brand new investors think that buying a home then slapping on a coat of paint or putting a new bathroom in will bring the riches. Nothing could be further from the truth. The second largest mistake new investors make and identifying it will help you avoid failing at real estate investing, is buying a property that needs far too much rehab.

Purchase properties that need very little to no rehabilitation to increase profits in your first deals. Holding properties too long will also cause a failure in the real estate investing game. Holding properties too long because of needed rehabilitations or market value downturns cause even more of a loss in value on a property. For all new investors, it is best to buy a property that will be sold quickly. Falling in 'love' with a house and changing your mind over and over will not give you or any other investor a fair return on properties purchased.

Treat your investments as business deals, not as stock to hold on to while the market gains or loses ground. Property investment will give a great return and build wealth for any investor in nearly any local market as long as the investor considers themselves as a business with all the rules and regulations- buy smart and sell smarter. Avoid trashed homes, be sure of good leads in your area, and never hold a property for too long.

About the Author

Michael Jake, your “Local Mentor” and Colorado's leading single family house investing expert, has created an absolutely amazing free course called "How To Succeed in Today's Colorado Real Estate Market." This FREE Mini-Course will reveal how you can make a boatload of cold hard cash in today's troubled Real Estate market.