How to Prevent a Poor Real Estate Deal
You hear the horror stories all the time. Someone finds themselves in the midst of a real estate deal gone wrong and end up losing everything. As much as we’d like to tell you they’re just stories, most of them are very real. For every successful real estate venture, there is a disastrous one out there somewhere.
Without the proper guidance, you can find yourself penniless with a valueless property that you cannot sell off or get rid of. Fortunately, we’re here to provide you with a little of insight on how to prevent that from happening. Allow us to take you through some of the ways to prevent getting stuck in a poor real estate deal.
Always See the Property for Yourself
Looks can be deceiving, especially when you’re viewing things through a computer screen. Thanks to the internet, you can view hundreds of properties from the comfort of your home. However, nothing beats seeing a property with your own two eyes.
There may be faults with the property that its owners might have “forgotten” to include on the listing. Many individuals decide to purchase a property on face-value, resulting in them receiving less than what they paid for. No matter how far you may be from a prospective property, always visit and see it for yourself.
Take a tour of the property and access it both inside and out. Only then should you decide to either pass or move on with the acquisition process.
Understand Your Environment
One key factor in not getting stuck in a poor real estate deal is understanding property value. The value of your property fluctuates based on its surrounding environment. For example, areas with poor school systems and high crime rates are relatively cheaper than more affluent neighborhoods.
The better the neighborhood, the higher your property value will increase. This makes your property easier to sell when the time comes as well as raises the likelihood of making a profit. On the flip side, if the property value of your environment decreases, it can be become more difficult to sell your property and if you do, it can potentially be at a loss.
Many property owners found themselves unable to sell their space, simply because they didn’t understand the type of environment they would be residing in. Be sure to do a full analysis of your prospective neighborhood as well its property value before making a decision.
Carefully Read the Terms and Conditions
If there’s one set of terms and conditions you should read, it’s the one involving your commercial property. Contracts are legally-binding agreements, which means once you sign, you must abide by everything stated in them.
Refusing to follow your brokerage agreement can lead to lawsuits, fines, and potentially jail time if things get really serious. That’s why it’s important to carefully over your contract with your broker as well as a lawyer. Reading the terms and conditions includes going over the fine print and knowing the difference between fixed and adjustable rates.
Too many times property owners have found themselves in financially unfair and strenuous situations all because they did not read their agreements. The property acquisition process was not meant to be completed overnight. Take your time, read, analyze, and negotiate. It will only benefit you in the long run.
Be Ready to Negotiate
Speaking of negotiating, it’s essential that you not come off as desperate. There’s a lot of properties out there and if you settle for the first property you came across, you can find yourself in a bad situation. Remember that someone always wants to sell a property just as badly as you want to buy one.
That’s where negotiating comes into play. Place both of your cards on the table and compromise. The art of negotiating was invented to ensure that everyone walks always satisfied. Don’t ever feel like your answer has to be yes if you don’t like what you’re being offered.
If the deal at hand isn’t swinging in your favor, it’s never too late to say no. Stick to your principles and stand tall. It’s the only way to come to a resolution that is advantageous to both parties.
Some Last Minute Tips:
- Seek out assistance.
- – The property acquisition process can be a long and difficult road to traverse.
- – It never hurts to have a second opinion.
- Speak with others that have purchased property in the past.
- – Their experiences can serve as a guiding light through your own.
- Avoid conducting business with individuals you do not trust.
- – Despite their credentials, you should always put your instincts and best interests first.