5 DEMERITS OF REAL ESTATE

[Ultimatetebe]

5 DEMERITS OF REAL ESTATE
1. Real estate has huge transactional costs and it can affect investment because of lack of profits.
2. Real estate business has high liquid. You can easily sell it for a profit within some few seconds as if you're trading.
3. Real estate business demands proper management at all times.
4. Real estate investors can be inefficient due to certain factors experienced in the course of doing the business.
5. It involves one taking a great deal of financial and legal liabilities most times.

 

[Dora Wi]

I'm not sure what you mean in point 2. Some people dislike real estate investment for the exact opposite reason - if you invest in a property, it is an illiquid asset. There are ways to generate an income stream from it, but selling it usually takes a while.

 

[Jasz]

1. No Guarantees

When you are buying real estate, you are making a long-term financial purchase. This means that you will be living in the property for many years to come. However, there is no guarantee that the property will actually increase in value over time. In fact, there is a chance that the property could actually decrease in value over time. This could mean that you will end up losing money on your purchase, which would be something that you may not want to deal with.

2. The Price May Not Be Right

While the price of real estate may seem reasonable at first glance, it can become more expensive over time. For example, some people who buy land with plans to build a house later may find that they have to spend more than they initially planned because of the cost of construction materials and labor. Others who buy houses or condos may find that they have unexpected repair costs and expenses related to homeowner's insurance and taxes over time. These expenses can add up and make it more difficult for homeowners to stay on budget with their purchases.

3. Time Consuming Process

It takes time for buyers to find properties that meet their needs and preferences when searching for real estate. There are many steps involved in this process,