3 Mistakes New Real Estate Investors Make [Don't Do These]
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The video discusses the top three reasons why real estate investors may experience losses and how to avoid them. The first reason is underestimating the cost of repairs, which can result in missing costly repairs such as roofs, HVAC systems, and windows. To avoid this, investors should climb up on the roof, check the HVAC systems, water heaters, electric panels, and windows, and create a list of everything that needs to be done to the property. Additionally, investors should overestimate every item and add at least 10 percent to the bottom line after calculating the rehab budget. The second reason is overestimating the after repair value (ARV), which can be avoided by finding three comparable house sales that are as similar to the property as possible and being conservative when calculating the ARV. The third reason is underestimating the timeline of the project, which can be avoided by being conservative when estimating the timeline of the project and factoring in holding costs. By being conservative in all aspects of the investment, including repair costs, ARV, and timeline, investors can avoid losses and make more money.
The video discusses the top three reasons why real estate investors may experience losses and how to