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10 Costly Mistakes to Avoid as a New Real Estate Investor<br />
Get all of the costs. In addition to the property taxes, ask your real estate<br />
broker if he/she can obtain data on the current expenses of the property, such<br />
as utilities and insurance. If it’s a commercial property this should be no<br />
problem. For a single-family home, this may be tougher, but a seller may<br />
provide this information if they know there's an eager investor looking for it.<br />
Evaluate multiple properties. You may feel that a particular property is<br />
the one, but you should look at multiple properties before making an offer.<br />
Ask your real estate broker to show you several within your price range,<br />
including properties you don’t like, so you can assess the different<br />
neighborhoods and have a better sense of your target property’s value.<br />
Obtain local statistics. Look at how the city compares with other localities<br />
in the area. How do the schools stack up? What’s the median income?<br />
Unemployment rate? What’s the population count, and is the community<br />
growing? How do the real estate taxes compare to nearby cities? All this will<br />
help you better understand the attractiveness (or lack thereof) of your target<br />
town or city over others. Don’t forget to check the official website of the city<br />
or county where the potential investment property is located; many local<br />
government websites include demographics, crime statistics, and other data.<br />
Determine property potential. Understand how the property is zoned.<br />
Can you expand it? Can you convert it to something else? What are the<br />
setback regulations from the street and bordering areas of the lot? If you<br />
have visions of developing the property, you need to know the city’s<br />
classification of the property and the limitations that come with that. If, for<br />
example, you want to alter the property’s use by turning a residential<br />
property into a commercial one, this will likely cost you in attorney fees, but a<br />
consultation with city managers is imperative in order to find out if that is a<br />
step you could even successfully take.<br />
20<br />
10 Costly Mistakes to Avoid as a New Real Estate Investor
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