REAL ESTATE INVESTMENT RISKS: HOW TO IDENTIFY AND PROTECT AGAINST 5 MAJOR RISKS

No matter how good the real estate market may look at the moment, one of the most significant real estate investments will always be market risks.

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Property-Specific Risks

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Liquidity Risk

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The most common worry prospective landlords encounter is the risk of lawsuits. Since the U.S. is a litigious society, anyone can sue landlords for several reasons.

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Macro Risk

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Interest rates

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REAL ESTATE INVESTMENT RISKS: HOW TO IDENTIFY AND PROTECT AGAINST 5 MAJOR RISKS

No matter how good the real estate market may look at the moment, one of the most significant real estate investments will always be market risks.

Property-Specific Risks

Shoddy construction and unsafe living conditions would be examples of property-specific risks that could damage the property.

Liquidity Risk

You aren’t able to quickly sell an investment and get the money from it, even in the best of circumstances.

The most common worry prospective landlords encounter is the risk of lawsuits. Since the U.S. is a litigious society, anyone can sue landlords for several reasons.

Business Risks

Macro Risk

The real estate market is critical to the health of an economy: A growing real estate market will help to grow the economy, but a crashing market may bring the entire economy down.

Interest rates

If interest rates are too high, this may present you with a real challenge regarding debt repayment or raising capital for real estate.

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