The Shocking Real Estate Blunders Entrepreneurs Swear They’ll Never Repeat—But Always Do
- Paying More Than the Property Is Worth
This may be the most painful mistake of all. If you pay more than your investment is worth, you lose money from the very beginning. That, in turn, can make expanding amenities or maintaining the property harder. Be sure to explore what similar properties in the same neighborhood are going for. Don’t just look at one or two. Get a sense of prices in your city and region overall.
Look at the economic forecasts for businesses in your area as well. The strength of jobs, the direction of interest rates and inflation all matter to property owners, because they matter to prospective tenants. Tenants, both commercial and residential, make plans based on their own financial situation. If technology firms tank and the building is occupied by multiple startups, they may fold. The building is left with empty offices. It can affect what the overall property is worth.
