3 Warning Signs of a Bad Deal in Real Estate

Let’s face it: most real estate deals is where the money’s at – and it would be wise for real estate professional to avoid deals where there little or nothing in it for them.

Simply put, it’s in the best interests to focus on good deals that give you a large margin as opposed to bad ones that offer you “peanuts”, in terms of profits. If you find yourself working on deals that fall into the latter category, it won’t take long for you to realize that you are wasting your time.

So, here are three warning signs of a bad deal:

#1: Missing or made-up Numbers

With the objective being to generate as much income as possible from these deals, it’s important to note that numbers that are made-up or don’t increase your margins aren’t worth spending your time on. Moreover, if the owner cannot provide important documentation such as the year-to-date profit and loss statements and so on and so forth, you’re wasting your time with this deal.

#2: Troubled Property

Even though properties seem viable on paper, a visit to the site will tell you a lot about whether the property is as good as it seems. For example, there might be major repairs that need to be done, and if the owner wants to pass that headache on to the buyer, then it’s not a good idea to spend on this type of a deal either.

#3:  The property has been on the market for a while

The difference between good and bad properties lies in the fact that the former gets off the listing quickly. If you’re spending time on a deal that has stayed in the listings for months, avoid getting involved with such deals.