Managing your portfolio is key to successful real estate investment. Investing in a variety of properties can be a good way to avoid market-specific risk. Diversifying your portfolio in this way can protect you from unexpected shake-ups in certain markets that might really do a number on an investment portfolio that is over-extended.
Managing a portfolio is like walking a tightrope. Staying balanced is the primary objective. Wind can come from either direction and knock you off balance, so staying vigilant and responding quickly to “lean into the wind” is the best way to stay balanced.
This means keeping an eye on trends in the market, and adjusting your investments to match that. Keeping an eye on your finances is also essential to how well you can respond when the winds start blowing up in the market.
Investing in real estate without a plan is like setting sail eastward and hoping you’ll hit England. Hopefully you’ve created a basic plan for yourself and have some kind of goal as the endpoint. However, having the plan is not enough. Now you need to carry it out.
Reviewing your goals on a daily basis and keeping track of your progress on a monthly basis is a great way to stay on track. Reminding yourself of what your goals are and where you are in terms of achieving them is a crucial part of staying on track with your investments.
Real estate investing is not easy, especially when things seem to be going wrong. It’s not hard to lose track of why you made the decision to invest. Reminding yourself of why you made an investment and why it is worth it is a great way to stay focused and keep an even keel in the long run.
Asking why and trusting yourself to have a solid answer boosts confidence, and while too much confidence can be a flaw, it holds true that a panicky investor is a bad investor.
Ask yourself, “Is what I’m doing truly productive in the long run, or is this just shuffling paper to feel occupied?” Are you investing in truly productive properties, or are you not taking the risks that you should to bring your portfolio where it has the potential to be? Taking stock of what you are doing in terms of making investments is essential for keeping a healthy and growing portfolio.
For example, you may have a goal to flip 6 homes this month, but are you wasting time on other projects that are busywork? Focusing on your goals and the tasks you need to do each day to accomplish these goals is an important process of becoming a successful investor.