Top FIVE things NOT to do as an Amateur Investor in San Francisco

5. Invest in the intangible new construction project - San Francisco real estate can be complicated for the seasoned professional. For amateurs, the bottom line is if it is called REAL estate and you can’t touch it, take a pause and learn more. The ever-so-present new construction project has been the downfall for many amateur investors. New construction projects are not all bad. But as an amateur one must account for a VAST number of factors that they have no control over and may not even understand.

4. Invest without research - Due diligence research is the real estate equivalent to truth serum. The outcome is often not the fairytale you wanted to hear but proper due diligence research can prevent an investor from over estimating profits and under estimating expenses. This is critical especially in the initial stages of budget determination.

3. Look for the get rich quick deal - If it sounds too good to be true, it probably is. Investment pitch professionals can make a 10 million dollar 1 bedroom, 1 bathroom, multi-owner condo on Turk and Taylor sound like money in the bag. Be realistic and understand what an average cash flow or profit should be for a project like yours before you invest.

2. Take on a large or complicated project as your first venture - This may be the most dangerous thing an amateur investor can do on their own. Instead, be conservative and keep the portfolio secure. Mistakes are bound to happen but when they do make sure they are mere learning experiences, not financial disasters. Before investing in any project ask yourself how much money can I stand to loose?

1. Listen to other amateurs - You call yourself an amateur for a reason. Literally speaking, a wealth of knowledge can be gained by networking with, and taking the advice of seasoned professionals. Not your neighbor who successfully purchased a home and thinks they know everything about investing. Remember purchasing a home to live in and investing in real estate for profit are as different as day and night.

Happy investing!