Is Successful Property Investing an Art or a Science? Failure to Combine Both Could Cost You a Fortune.

You often hear this: "Don't let your emotions interfere with your property investment decisions."

However, this is where most property investors fail.

Many investors make emotional purchases instead of performing proper due diligence by analysing property data closely. 

Their buying decisions are determined by where they live, where their friends are investing, where they want to holiday, or where they want to retire.

To tell you the truth.

It's not wise to invest in something like that.

From my property experience over the last decade, I have noticed the five most common types of property investors, and it made me wonder which style was most successful and why.

Do you want to know?
Let's read it through till the end.
Do you know which type of investor you are? 
Generally, there are five types of property investors:

1. Speculators

These investors buy real estate based on its potential (future) selling price rather than its actual (current) value. They buy big and may borrow large sums. They believe that they are investing, but in reality, they are gambling by following the media.

2. Emotional

These investors tend to buy real estate based on emotional value rather than investment value. Typically, they buy the first property they seem to like instead of performing due diligence or consulting professionals. Unfortunately, this makes them easy prey to flashy schemes.

3. Observers

They usually understand the importance of informed decisions but tend to study the market superficially rather than getting thoroughly involved. They have the qualities of great investors but end up witnessing success rather than experiencing it directly. Nevertheless, they stay in the game by reading several books and attending multiple events on investing.

4. Analytical

These investors attend various workshops and go through multiple inspections, searching for their ultimate property. They seek advice from many property gurus and perform their due diligence on various properties but don't follow through with an actual purchase. They believe that spending more energy and effort in finding the property will bring them greater rewards and returns.

5. Smart

These investors tend to track market trends. They understand the importance of a professional team that can help them generate a significant passive income. They act based on the due diligence conducted by trusted advisors, thereby minimising risk for themselves.

Now, the big question is: which type of investor are you?

You should undoubtedly avoid getting categorised as a Speculator or Emotional Buyer. Being an Observer doesn't help as you tend to stay on the sidelines all the time. Ideally, you should target becoming either an Analytical or Smart Investor. The challenge with Analytical investors is that they may either move very slowly or not act at all by falling prey to 'analysis paralysis' and overthinking a situation.

On the other hand, Smart Investors value knowledge and leverage the experts around them. As the stakes are high, they do not hesitate to turn to experts in the field for advice.

Going back to the original question, is property investment an art or a science?

It's both.

Data and research are essential aids to a successful property investment decision, but they aren't sufficient on their own.

Investors should also incorporate local knowledge, expertise, experience, and perspective for optimal decision-making.

Practical experience can never be substituted for theory. Would you agree?

Property investors who have conducted internet and data research to cover the "science" part of the investment equation will benefit from expert advice because they bring the "art" part of the equation.

As the saying goes, "it takes two to Tango". In the absence of the other, one is worthless.

Working with an expert with experience on the ground and understanding the local markets is a huge advantage.

The experts know where the most robust demand is in each area or which side of a road or suburb is more valuable. Their perspective is something that neither money nor data can provide.

So, what's the key lesson here?

Investing in property is expensive, and you can't afford to make a mistake.

Property investment data is crucial when making an investment decision, but it's only half the job.

Successful property investment requires both science and art. You must combine both to save money.

Recognise the importance of investing in a good team of professional experts before investing. 

By collaborating with experienced professionals, you can avoid costly mistakes that many novice investors make. And importantly, you can act quickly and that too with a lot of conviction.