Am I approaching this as an investor or am I emotionally involved?

Most investors make emotional mistakes buying close to where they live, close to where they want to eventually retire, or where they want to holiday - these are emotional not investment or business decisions.

When buying a home, about 90% of your purchasing decision will be based on emotion and only 10% on logic, which is understandable, as your home is where you’ll raise a family.

But when it comes to investing, however, letting your heart rule your buying decision is a huge ‘no-no’.

Allowing your emotions to cloud your judgement means you are more likely to over-capitalise on your purchase, rather than negotiating the best possible price and outcome for your investment goals.

Property investors should always buy the property based on analytical research, and leave their emotions at the door.

What are the local demographics like? Will this lead to the capital gains and returns you require?

Is it the best location to attract quality tenants who can afford to pay you increasing rent over the years rather than tenants who are only a week away from being broke?

Will it appeal to the owner-occupier market that sustains property prices in the long term?

By answering questions like this, rather than buying a house because you loved the curtains or thought it would make a good holiday retreat, you’re thinking based on financial gain rather than personal feelings.

And at the end of the day, investing is all about economics, demographics, and finance and not emotions.

RealRenta has all the tools that a property manager has but for less than ¼ the cost of a property manager.

Join now and the cost is less than a cup of coffee a week to manage your rental property

RealRenta also has a free vision, so why not check it out

Jason Gwerder
Wednesday, 8 June 2022

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