Despite the common notion that getting into real estate is an easy way to make quick money and profits, it is, in fact, a pretty risky business at times. During instances that the housing market isn’t doing well, it can be hard to make a steady income via being a real estate agent. In this article, we have explored some of the risks involved in real estate.
1: GENERAL MARKET RISK:
It is a known fact that all markets go through some highs and lows that are very unpredictable in nature. Inflation, market trends, interest rates all play a role in this. A large part of a real estate agent’s job involves taking risks and being able to keep up with the fluctuations in the market. He or she must learn to place bets based on instinct and live with the fact that they do not have a regular 9-5 job and hence not a steady and consistent paycheck.
2: CLIENT LAWSUITS:Suppose you introduce a new client to property placed in a fabulous neighborhood, the value of which has a definite chance of going up over the years. If you thus, sell your client the property stating its value will go up over time and this does not, in fact, deem true and the property value stalls, there is every chance the client will file a lawsuit and sue you for making false statements.
3: CLIENT INJURIES:
An open house can be very chaotic what with a large number of families walking in and out and examining every corner. There can be many things around the house that are out of order and can easily hurt anyone. An agent simply cannot have his eye trail every corner and if someone does end up getting injured on his or her watch, the agent can be sued. However, such lawsuits are fortunately covered by the general liability insurance.
4: VIOLATION OF YOUR CODE OF ETHICS:
If an agent violates his or her code of ethics or professional standards they can be sued by the client. For instance, if they fail to mention important details about the property at hand, purposefully or otherwise, like for instance, that it is located in a noisy neighbourhood; the client could consider this a huge mistake on his or her part and file a lawsuit against the agent. Thus, it is important that the agent stay very upfront and open with the client and remember to disclose all details regarding the property to them beforehand.