Real Estate Is Risk-Free! But…
Tuesday Jan 31st, 2023
It’s a fact that there’s significantly less risk involved in real estate investments…
And have a great opportunity for everyone from beginners to pro to make decent gains over their investments.
But, don’t forget that there’s some risk – even if it’s significantly less.
And since there’s risk, you need to be aware of it.
Prudent real estate investors understand the risks—not only in terms of real estate deals…
…But also the legal implications involved—and adjust their businesses to reduce those risks.
Some of the risks associated with real estate investments are;
1. Can be unpredictable
In most cases, the real estate value goes up. But that’s not the obvious case.
Sometimes, the value could depreciate…
…Depending upon a lot of factors.
Supply and demand, the economy, demographics, interest rates, government policies, and unforeseen events all play a role in real estate trends, including prices and rental rates.
2. Negative Cash flow
Cash flow on a real estate investment is the money that's left after paying all expenses, taxes, and mortgage payments.
Negative cash flow happens when the money coming in is less than the money going out—meaning, you’re losing money.
3. Choosing a Bad Location
Location ultimately drives the factors that determine your ability to make a profit…
After all, you can't move a house to a more desirable neighborhood—nor can you move a retail building out of an abandoned strip mall.
So to make a better decision, you have to perform research to find the most profitable location…
Sade Sanni, Broker of Record.