There is absolutely no doubt that purchasing a property is a rather interesting mix of excitement, stress, and emotion. Chances are, the moment you have gone through hundreds of property walkthroughs and have begun making offers, you will probably get hooked on a house or two.
However, bear in mind that even when you are really deep into everything, something might unexpectedly pop up in your way that causes the deal to seem less than appealing. Yes, it is true that it is highly difficult to reconcile your love for a gorgeous piece of real estate with the fear that a financial venture doesn’t seem to quite add up.
Well, if this does happen to you, you need to begin considering whether or not you still want to move forward with the deal. This is certainly a tricky choice to make and definitely not a decision to take lightly. So in order to help you out, here are a few red flag scenarios that you should seriously take into consideration when you are thinking about placing an offer on your next real estate conquest!
How to Purchase Real Estate With No (or Low) Money!
One of the biggest struggles that many new investors have is in coming up with the money to purchase their first real estate properties. Well, BiggerPockets can help with that too. The Book on Investing in Real Estate with No (and Low) Money Down can give you the tools you need to get started in real estate, even if you don’t have tons of cash lying around.
Purchasing a property can be considered a huge milestone in any individual’s life. Regardless of whether it is your first or your fiftieth, unless your heart is in sync with your brain on this deal, you absolutely shouldn’t be moving ahead. This is simply due to the fact that as with all major decisions in life, you should be cautious. Trusting your intuition can seriously go a long way. For example, you wouldn’t jump off a cliff unless you knew that there was a safety net below it to catch you, right? So if you even feel the slightest bit uneasy about a real estate deal, it is time to jump ship.
Realize if You’re Overpaying
Before you go into any real estate deal, you should be well informed of the house’s value. However, many investors, even the seasoned pros, often neglect to take note of the price of similar houses in the neighborhood and end up paying for more than what it’s actually worth. Nevertheless, if you are lucky enough to discover that the house is far too pricey, then be sure to whip out your parachute and get away quick!
Know What Compromises You’re Willing to Make
Before you begin scouring around for properties, more often than not, you will have produced a good, well-thought-out list of your must-haves, needs, and desires, in addition to all the compromises that are going to be particularly difficult. Why do you do this? Well, this is due to the fact that while you can not control what comes onto the market, you always have the power to control your approach to them.
Unfortunately, many people do not realize that a compromise that should kill a deal straightaway without fail is when there is something wrong with the property structurally. They often go in blindly, bluffing to themselves that a little damage to the house can be overlooked upon. However, if this happens with the property, no matter what the structural error/damage is, you should definitely stop dead in tracks, take a hefty step back, and listen to your gut. Once you have done your heavy pondering, if you find out that it just isn’t up your alley, be sure to get out ASAP. The inspection period clause can be your friend in this circumstance. Lastly, if there is a boarded house next door, then that is also another area that should be of concern to you.
Nevertheless, alway be sure that you are fully aware of when enough is seriously enough, and be willing to walk away. Until you’ve actually signed the contract, you have every right in the world to do so. So don’t ever feel pressured by yourself, the owner, real estate agent or anyone else that you have to complete that real estate transaction because at the end of the day, you should be feeling happy, excited, and 100 percent satisfied about the purchase.
Investors: What steps do you take to avoid regrettable deals?
Let me know with a comment!