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5 Common Mistakes to Avoid on Your Property Investment Journey

Mortgage| General
February 05, 2026•3 min read

5 Common Mistakes to Avoid on Your Property Investment Journey

Building a property portfolio can be an incredibly rewarding path to financial freedom. However, it’s also a journey filled with potential pitfalls that can easily derail your progress. The good news is that most of these mistakes are entirely avoidable with a bit of foresight and the right advice.

Here are five of the most common mistakes we see new investors make, and how you can steer clear of them.

Mistake #1: Buying with Emotion, Not Logic

It’s easy to fall in love with a property’s stylish kitchen or sunny backyard. But when you’re investing, you’re not buying a home for yourself—you’re buying an asset that needs to deliver a financial return. Paying too much, ignoring potential red flags, or choosing a property that doesn’t fit your strategy because it “feels right” is a classic rookie error.

How to avoid it: Stick to your checklist. Does the property align with your chosen strategy (e.g., high rental yield or capital growth)? Do the numbers stack up? A great investment is one that performs well on paper, not just one that you would personally love to live in.

Mistake #2: Underestimating the Costs

Many new investors focus solely on the mortgage repayment and forget about the other significant costs of owning a property. Council rates, insurance, property management fees, and maintenance can add up quickly. If you haven’t budgeted for these, your profitable investment can quickly become a drain on your personal finances.

How to avoid it: Create a detailed budget for every property you consider. As a rule of thumb, budget at least 1-2% of the property’s value for annual maintenance. It’s also wise to have a cash buffer—a separate savings account—to cover unexpected repairs or periods of vacancy without stress.

Mistake #3: Over-Leveraging Your Finances

Leverage (using borrowed money to invest) is what makes property such a powerful wealth-building tool. However, taking on too much debt without a safety net is a high-risk game. If interest rates rise or you have a period without a tenant, an over-leveraged portfolio can become a significant financial burden.

How to avoid it: Work with a mortgage adviser to assess your borrowing power realistically. We stress-test your financial situation against potential interest rate rises and help you structure your loans in a way that protects your cash flow, ensuring your portfolio is resilient.

Mistake #4: Ignoring Professional Advice

Thinking you can do it all yourself to save a few dollars is a false economy. Property investment involves significant financial and legal complexities. Not getting the right advice from the start can lead to costly mistakes, from paying too much tax to choosing the wrong ownership structure.

How to avoid it: Build a team of experts. This should include a mortgage adviser who understands investment finance, a solicitor who can handle the legal conveyancing, and an accountant who specialises in property. Their advice is an investment, not a cost.

Mistake #5: Having a Short-Term Mindset

Property is not a get-rich-quick scheme. While some people make money flipping houses, true, sustainable wealth is built over the long term. Panicking and selling during a market downturn, or expecting huge returns in the first year, often leads to poor decisions and financial losses.

How to avoid it: Think in terms of a decade, not a year. A long-term perspective allows you to ride out market cycles and let the power of compounding capital growth work its magic. A solid strategy and a well-chosen property will almost always win in the long run.

Your Path to a Successful Portfolio

Avoiding these common mistakes comes down to one thing: preparation. By approaching your investment journey with a clear strategy and a team of trusted advisers, you can build a successful, resilient, and rewarding property portfolio.

If you’re ready to start your investment journey on the right foot,book a free discovery call with us.We’ll help you build a plan that avoids the pitfalls and sets you up for long-term success.

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