When To Walk Away From an Investment Property
Something that we’ve become quite familiar within our 8 years of buying, renovating, and selling residential real estate is when to walk away from a purchase. This process can be insanely complicated when you see potential and opportunity in different properties. We GET IT! However, when it comes to investing in the residential real estate market, there are a few things you want to look out for when investing such a large chunk of money.
And we want to share with you what we have learned so that you don’t make the same mistakes we have. So here are 4 warning signs to look for when you know it’s time to walk away from an investment property.
Wearisome inspection report: if you choose to do an inspection on the property you are investing in and you notice that some of the inspection issues are larger than you want to handle.
Last minute contract changes: sometimes changes to the contract are needed when both parties can fully agree on the changes at hand. However, when one side requires multiple amendments of the contract in order for the deal to come together, tread carefully.
Overextending your financial position: obviously check your numbers before going under contract but even then, if during the process you find the investment increasing in expense due to unforeseen circumstances, take that into consideration and don’t overextend yourself if the numbers aren’t making sense.
Trust your gut: I believe we all carry intuition. This is different than nervousness, anxiousness, and even fear of the unknown. This is something you feel deep down in your gut; the sort of feeling that seemingly taps on the inner walls of your subconscious, quietly warning you to take a step back or reconsider. Trust it.
Investing is a scary but also exciting endeavor. And unfortunately, you can’t know all the things to look out for for every single investment property. But that’s also all apart of the journey.
We have found that with each property we have renovated and sold, we have learned something substantially different in each one. And all of those little teaching moments have prepared us to help YOU! So take heart, you’re already a lot of steps ahead of where we were!
