Risk vs. Reward

[ 0 ] September 22, 2016 |

 

Every real estate transaction comes with some amount of risk and potential reward. For example, you may love the house that backs up to the four lane road, with a 45 mph speed limit, and the reward for you may be a home you love. But we might suggest a couple of potential risks. We would tell you that, 1) that home is always going to be more difficult to sell — because at least half of the people that look will rule it out because of the road, and 2) you may love the home now, and you may love it if you are the type of people to spend most of your time inside, but if you enjoy outdoor living, you may grow to hate the hum of the road.

Or, let’s say you see something shiny and gold in color at the bottom of a tank full of water, and because you’re a gemologist, you determine there is a 90% certainty it is gold. But, let’s say there are also two well-fed sharks in the tank; these sharks aren’t hungry and they look friendly enough. And, because you’ve watched Shark Week five straight years without fail, you know the feeding habits of sharks well enough to believe it’s highly unlikely you will be eaten alive. You may very well make a very bad decision, but at least it was your decision and at least you had all of the information available with which to make it. That is, you understood the risk and the potential reward.

But what if the tank is murky? What if you see something at the bottom of the tank but it’s not shiny and it may or may not be gold in color; it may be something of great value, but it may also be a simple rock. And what if you think you see something swimming in the tank, but you can’t quite make out what it is? It could be a starving shark, or it could be a gentle and harmless manatee. How do you decide what you’re going to do? You have no understanding of the risk, nor do you know if there is any reward to be had.

The stakes may not be quite the same, but there is always risk involved when buying or selling real estate. We believe it’s important you have a good understanding of the potential reward, as well as the potential risk, involved with any real estate-based decision. We do our best to detach ourselves from the outcome and instead focus on making sure you have the proper information, presented in as clear a way as possible, to make a decision. Your job is to determine if the potential reward is worth the potential risk, we feel our job is to make sure you have the information necessary to make the call.

At Navigate Residential we have 25+ years of experience in the real estate industry. We’ve seen good deals and bad deals. We’ve seen leaky roofs, lead paint and broken water pipes, and while it is impossible to see everything, we’ll do our very best to help you make the most informed real estate decision possible.

 

Category: Real Estate

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