Obviously, property investor comes from different background and discipline. Thus it is obvious as well that they have different personalities and characteristics. If you find that the average property investors are risk-averse, there are also some of them who are easily willing to carry high-risk investment.
Some people may consider it as brave act and others may consider it as foolish act. It can be different from different point of view.
It is not entirely a good thing to be too willing to take risk especially the high leveled one. However, it is not entirely bad either because too much enthusiasm can lead to mistakes.
Mistakes often done by risk enthusiast property investors
As been said earlier that there are different point of view when it comes to taking high risk investment deal.
For those who tend to be risk-averse, the things to consider when analyzing the risks are the return and impact of failure. Those aspect should be analyzed objectively. However, it seems that risk enthusiasts are more oriented into making high returns and neglecting the impact of failure. Here are some mistake commonly done by risk enthusiasts in property investing:
You do are underestimating the risks
One of the most obvious mistake of risk enthusiast is underestimating the risk. As mentioned earlier that there are two aspects in risk analyzing that should be considered in balance objectively.
Risk enthusiasts tend to ignore the impact of failure which lead them to make mistakes easier. It can leave them with negative equity and bankruptcy at the end.
You are usually following the hype, blindly
Another mistakes commonly done by risk enthusiast in property investing is tend to follow the hype blindly. Those who are risk loving will easily fall in love with hype of promising thing.
For example, risk enthusiasts who attend seminar which talk about the next big thing in property industry will blindly follow it without any consideration whatsoever.
However, this mistake is quite hard to avoid since most risk enthusiasts are active in attending seminars. Remember that they are high-return enthusiast so they will easily agree to something that can promise them that even if the risk is relatively high.
Overconfidence should be experienced by anyone
Next obvious mistake is overconfidence.
Being confident of decision you are going to make is important as long as it is taken under thorough calculation and consideration both of return and impact. However, overconfidence is not a good thing.
It comes from unnecessary gut feeling instead of reliable data or information through research. Since they don’t follow the structured process, it will be easier for them to make mistakes in the process of investing.
There is nothing like getting reach in a night
Another mistake done by most risk enthusiast is fall for a get rich quick scheme.
They tend to be more naïve and so that they are easily manipulated due to the promise of getting rich quick.
They tend to easily believe to what free seminar organizer share regarding to the information of promising property trends and stuffs. The best thing you should do is to analyze the risk properly and thoroughly through research and well calculation.