The Disadvantages Of Real Estate
Scott Rister
Buying and selling real estate is a thing people have been doing for years. It is indeed one of the biggest monetary decisions of one's life so it is important that it is done right. In most cases, people do not have much idea about real estate, they know just the tits bits which does not help much. There are specific risks that you cannot control when in real estate. Not knowing what to do and where to begin in real estate can be tricky, hence it better that one takes the help of a real estate agent who has a good reputation in the market.
When we talk about real estate we cannot help but think of Scott Rister. He is the man who has created a fortune in real estate. He has a portfolio of properties across the globe which he has successfully made with his real estate knowledge. He suggests that there are many advantages to real estate but along with that comes a list of disadvantages as well:
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Lack of liquidity is the biggest issues when we deal ewith real estate as it is not easier to convert real estate into quick cash. The problem is more when we are dealing with commercial real estate investments. No matter how big or small the investment is when it's time to liquidate it the process cannot be done overnight. There are difficulties faced in determining the property value. Investors selling a real estate property are selling a stream of income. This stream is determined by the risk associated with the stream of income.
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The borrowing when becomes overextended can be a bad thing. Leveraging is good when one is making an investment but too much of it can be a potential risk. The leverage increases the potential return on the project as well as the risks associated hence it is better to optimize the leverage than maximize it. Real estate agent plays a critical role in making the right investment decisions. Commercial or residential both properties need focus and intense participation even the slightest mistake can make things go wrong. Management expertise is required to buy or sell a property and real estate agents are the best people in this case.
In the end, any profession we take up has its good and bad. It's just how we use every point to our advantage. Success and failure in real estate cannot be predicted, but some modification and changes can greatly enhance the entire process.
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