In a recent post, we looked at the way in which emotion can impact decision making when it comes to property investment. Another key to successful investment is overcoming the biases that we can have built into us.
Listening to close friends or following what they do can be a trap, unless they are in exactly the same situation or with exactly the same goals. This is especially important when looking thorough a property; better to take someone who is impartial than someone who, because you know and like, may influence you in overlooking possible flaws.
Maintaining the status quo is a bias that impacts all of us – humans are pretty resistant to change at the best of times. If you have lived in the same area for a long time, it may be hard for you to look further afield. When buying investing property, you are not necessarily ever going to live in the residence – the location should be chosen for its potential investment value.
Just as we can find change difficult, humans also have a natural tendency to prefer living in the present rather than considering what the future may hold. The name for this is “current moment bias”. This is not useful when looking to purchase an investment property – especially in the current cooling market. A property investment should be focused on the future and meet your financial goals over the long term.
An unbiased view is one of the most valuable things you can have when choosing to make a large investment. Accrue Real Estate do the research on the current Melbourne property market and having assisted clients over a number of years in property dealings they are able to draw on a wide range of knowledge and experience. Accrue help their clients to make informed decisions so they can realize their investment goals.