In Real Estate, Smart Investors Don’t Run out of Questions

Written by: David Wilkening

Perhaps partly because I live in Orlando where we have had the infamous cases of Casey Anthony (thankfully past) and now Trayvon Martin (still with us for perhaps a long time), I have a deep appreciation for what might be called Q&A’s.

As all followers of real and dramatic crimes know, attorneys on TV cop shows and in real life never ask witnesses a question (Q&A) where the answer is not already known (at least to the lawyers).

Not so in journalism and real estate.

Diverse though those fields may be, they share these common elements: namely, a lot of questions. Or I should say they are very similar in never running out of questions.

Now if I was an expert witness, I would have to add my own qualifications for making the above statement.  I have taught college journalism. And I have written about real estate and investing for more than a few decades.

So with that in mind, trust me to tell you that in both fields of journalism and real estate, you should never stop asking questions.

You can’t rule out emotion in any purchase. Say car buying. Someone likes the shape and size of the design. And it is fast. And car dealers sell you the buyer on the attractive image of you in this car.

Smart buyers don’t make this mistake when buying real estate. They rule out emotion. And they ask pertinent questions that they honestly answer.

Real estate questions include but are not limited to these when buying almost any property:

—What changes will you have to make to later sell at a profit?

—-Can you afford or do you have the money or access to the amounts needed to make necessary changes?

—While you are figuring out exactly how much it will cost you to make those changes, these should also be among your dollars and cents cost estimation of financing the property in the first place such as mortgages, interest loans if you get a loan, etc. In other words, a total financial breakdown and, hopefully, with some allowance for Things That Happen Unexpectedly/Not Under Your Control.

—Also, a rigorous and uncompromising evaluation of your own at-risk money: how much are you willing to lose, worst case scenario? Why that number and why not?

If you ever run out of questions, I would say you are in trouble. That’s because there are no end in possible scenarios unimaginable to you right now. These might be called challenges. Or they are better and more often be termed crises’ that could range from storm damage to an individual home to the collapse of the entire market (these have happened before and will again).

While I don’t have the answers to all potential questions, I do have a suggestion.

When you run out of questions, turn to an expert to ask for more. Questions, that is.

Journalism is not the courtroom where the lawyers already know the answers.  It is like real estate. You should never run out of questions and you won’t know the answers until after they are asked. ###


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