How to Lose Money in Real Estate

We’ve talked about how you can make money in real estate, but what are some ways this investment can backfire? By knowing how people can lose money in real estate, you’ll be better prepared to make a good investment.

Market Downturns

This is one of the most well-known ways of how a good home purchase can turn into a bad real estate investment. The impacts of the 2008 housing market crash are still felt by many today.

The good news is that a housing bubble and subsequent bursts can be tracked. There are no guarantees, but even in the years leading up to 2008’s crash, many people were already nervous about where home prices were headed. Read up and stay informed on the state of the housing market to help make good real estate investments.

Bad Neighbors

While you might be able to put up with the Urkels and Kramers of the world, future buyers probably won’t. From nearby factories to neighbors who care little for their curb appeal, bad neighbors can negatively impact your home sale.

Bad History

A death in your house — even if occurring naturally, and even if from a previous owner — spooks people from wanting to buy. Unfortunately, there are enough horror movies to scare potential buyers from wanting a home with some, erm, history.

Going Over the Top

Rapper 50 Cent had to take around an 80% cut on his mansion. Michael Jordan still hasn’t sold his Chicago home. The more over-the-top your place, the more niche your buying market becomes. This inevitably lessens your chances of selling.

Some personalized details to your home are OK, but there’s a fine line between “unique” and “eccentric.” Before making any substantial changes, remember to think with a seller’s mindset — you won’t own this home forever.

Too ________

Too big, too much carpet, too many cobwebs, too little closet space, etc. Buyers are like Goldilocks — they want a property that’s juuuust right. Keep up on current trends to know what buyers are looking for. 

And remember — if there are things that bother you about your property, they’ll likely bother others. It’s better to make those changes now and increase your home’s value when it’s time to sell.

If you’re reading this list and wailing at all the boxes your home checks, don’t despair! RealtyHive offers time-limited events to make selling easier. Even if you’re ready to get rid of your home as-is, we’re the ones to call. Sell with RealtyHive for a stress-free process.

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Emily Wottreng

Emily is a freelance writer and SEO specialist from Wisconsin. She attended the University of Wisconsin - Madison before traveling and working in Arizona, Colorado, and Wyoming, where she's currently based. Emily has written with RH since 2019 and loves what she does!

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