How to Lower Your Risk In Real Estate – Real Estate Risk

Kris Krohn here with Limitless TV and
today we’re talking about how you minimize your risk in real estate. I’m
gonna share with you the top three ways to do this and also my silver bullet on
how to make sure you put yourself in the safest position for massive profits So I’ve got three factors for you to be
aware of today when it comes to reducing risk in real estate and these are things
that a lot of investors actually are not aware of. I’ve just picked it up from
doing thousands of deals and these are part of the rules that I personally use
when doing real estate on single-family homes. So the three factors to help
reduce that risk first come down to low maintenance. You
know a low maintenance home is one that is a newer, it’s in better condition. It
does not need to be a new home but a home in the last 20 years that it’s been
build is gonna be definitely different from a home built 50 years ago, 80 years
ago, a hundred years ago. Things that are using old plumbing in an old electrical
old homes just have a lot of maintenance issues. They have a lot of maintenance
problems and tenants generally complain a lot about these homes. So the first
thing is I’m looking generally for low maintenance homes that means newer homes.
The second factor is I’m looking for home in a nice area. If I buy a home in
the slums I’m gonna attract lower income, I’m gonna attract people that usually
skip town, I’m gonna attract people that beat up on the homes and so I want nice
area. If you know what the slum area looks like, I don’t care how good the
cash flow looks like on paper in reality it is likely going to be a lot worse
than you think or hope that it’s going to be because old homes have higher
maintenance and bad areas usually end up having higher maintenance not just homes
but higher maintenance tenants. So that’s the second one that you want to watch
out for. The third characteristic that I use in selecting a market when buying a
home is, it comes down to you what the average income is of the people in that
area. And what I mean specifically by that is that our national median income
is 44 thousand dollars but if I have an area where the average income is $60,000
that’s one of my sweet spots. $60,000 ends up putting the type of person into
a home that is home owned or quality minded it’s the kind of person that
values their credit and it’s the kind of person that we use even their own money
to help do upkeep on the house and make sure that everything stays really nice.
The more you see that income drop the worst people are going to treat your
house. So go with people, go with an area not just not just an area where
the incomes 40,000 and you’re hanging out for someone that makes more than
that because that’s also really risky too. Why? because you’re not playing the
averages you need to go to an area where the average income is higher. Where you
have generally nicer homes that are going to be lower maintenance. And if you
watch out for these three things, it’s going to help you hands-down experience
far less risk. At the end of the day real estate produces, you’ve got your equity
that you walk in to. It produces this cash flow and ultimately how it performs
a paper from reality is going to come down to its maintenance level, the area
that you buy it in and the average income that people in the area make. And
as a bonus, aside from these three things there’s one more magic bullet. A magic
bullet of what I do to make sure that I’ve reduced my ultimate risk in
real estate. The ultimate bonus that I can give you
today for reducing your risk is to buy right, What do I mean by right? If they
don’t got equity, I ain’t playing. That’s what I mean by buying right in addition to the
great tricks that I shared with you. Ultimately the greatest safety comes
from Warren Buffett’s advice where he says buy low sell high. An eleven hundred
page book snowball is all about teaching buy low sell high. And in real estate,
what you’re doing is if it were to take you on a hundred thousand dollar home 15
years to pay off thirty five percent of the mortgage then why not just start and
skip ten of those years by buying into a home with a discount today. It means that
if life goes on on its head, cancer comes in, you need to change things up you need
money for something you can liquidate your asset. You’re gonna come out with
more money than you started with and you’re up on top from day one. That’s the
bonus is by right. if you don’t got equity don’t touch that. The ultimate way to
reduce risk is just have a powerhouse professional experienced team and come
in and do the work. That’s honestly what I do. And so if you want to access that
team, click the below. Learn more about who we are, what
we do. And have my team build your portfolio and you keep 100% of the

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