Thinking about getting into property investment?
Before you jump in, let’s talk about something many beginner investors don’t like to admit: most new property investors make costly mistakes. These slip-ups can drain your time, money, and motivation—but the good news? They’re very avoidable with the right knowledge.
In this guide, we’ll break down the top five mistakes new property investors make, explain why they happen, and give you clear steps to avoid them.
Let’s get into...
1. Choosing the Wrong Area to Invest In.
How do I choose the right area to invest in?
Common Mistake: Investing in areas that are “trending” or “affordable” without doing proper due diligence.
Why It Hurts: A postcode might look promising, but if it lacks tenant demand or faces council restrictions, your return on investment can quickly disappear.
How to Avoid It:
• Research local rental yields and long-term demand.
• Study population trends and employment growth.
• Review council development plans and restrictions.
• Speak to experienced investors who know the area
✅ Tip: Data beats hype. Always look at the numbers before buying.
2. Starting Without Proper Property Investment Training.
Mistake: Jumping in without learning the basics of property strategy, finance, or legal compliance. Are you asking yourself, Do I really need training before I get started? The answer, yes you do.
Why It Hurts: Many new investors lose money by skipping due diligence, mismanaging renovations, or misunderstanding their responsibilities as landlords.
How to Avoid It:
Get trained before you get started. Whether it’s reading books, joining webinars, or plugging into a support system like we offer at Sourced, education gives you the confidence to act fast and make smarter decisions.
3. Overlooking Legal Requirements and Compliance
Mistake: Assuming legal and planning requirements are minor details.
Why It Hurts: Property law is complex. Missing a licensing requirement, tenancy rule, or planning permission can stall or derail your project.
How to Avoid It: What legal mistakes should I watch out for?
• Consult professionals (solicitors, mortgage brokers, planning consultants)
• Understand landlord licensing, HMO rules, and building regulations.
• Review contracts and legal documents thoroughly before signing.
✅ Tip: Set a legal budget before investing—cutting corners here often costs more later.
4. Relying Only on Estate Agents to Find Investment Deals… Can I just rely on estate agents to find me good deals?
Mistake: Waiting for estate agents to send good deals.
Why It Hurts: The best property investment opportunities are often off-market—you won’t find them on Rightmove or Zoopla.
How to Avoid It:
• Learn how to source your own off-market deals.
• Build a network of investors, agents, and local contacts.
• Use direct-to-vendor marketing or attend auctions.
✅ Tip: Our Sourced Partners are trained to find deals before they hit the open market.
5. Thinking You Need a Lot of Money to Start… What if I don’t have enough money to get started?
Mistake: Believing property investment is only for people with large savings.
Why It Hurts: Many potential investors delay for years, thinking they need £100,000+ to get started.
How to Avoid It:
• Learn creative deal structures: lease options, bridging finance, rent-to-rent
• Explore joint ventures with partners or investors..
• Focus on adding value (e.g., refurbishments or conversions) to create equity.
✅ Tip: Property is a strategy, not just a purchase. If you can build the right deal, the money will follow.
Final Thoughts
Look, property investment isn’t about luck. It’s about knowledge, connections, and action.
You don’t need to be perfect, but you do need a strong foundation—and that starts with knowing what to avoid.
If you want a head start and a support system built around helping people actually succeed, there are options like Sourced Property Partner designed for people just like you. But the first step? Ask better questions. Seek better answers. And never stop learning.
Want to see how we help first-time investors avoid the common pitfalls?
Download our prospectus to find out more.
Author
Chris Kirkwood
