Loss in Real Estate & How Overcome

[Chirag Patel]

Hello, 

Just want to hear if anybody had made any losses in real estate, how much, what mistake lead them to loss and how did they overcome it and what was the strong point which still kept you doing business in real estate even after loss.

It would be great to get such information for beginner like me and other who cant prevent themselves from doing similar mistake.

[Bill B.]

Not purchasing several properties because they weren’t as good a deal as something else I was buying at the same time or had purchased in the last couple weeks. This easily cost me $500k.

I was buying a pair of cookie cutter homes in the neighborhood. 1900-2100sf, couple years old, like new, etc etc. They were $105 & $107k. I had the chance to buy a few more for $110-$115k but they needed water heaters and new carpet. I offered $106k between the two I had under contract that didn’t need any work. They went for lost to someone else. 8 years later they’re worth about $330-$370k plus I lost out on 8 years of rent. 

I guess what I’m saying is don’t compare an opportunity to one you got in the past. Even if they are “identical” and it was only 2 weeks ago. it can still be a good deal at a higher price. 

As someone said in a BP podcast a week ago. Don’t look at your returns in year 1, those aren’t the life changing numbers. Look 10-15 years out. 

Ps. I’m going to add that I’m also saying you can lose more money with inaction than action. As a buy and hold investor I can honestly say with over 20 years in and more than a dozen properties, I have never lost money by buying a property or taking an action.