Caspar Chou Pinpoints 5 Real Estate Red Flags

5 Red Flags New Investors Miss

Red flags are not always obvious in the real estate industry. Because locations evolve and the needs of tenants, there will always be some amount of risk involved. However, according to Caspar Chou, certain red flags have stayed consistent over the years.

Lack of Transparency

Since the pandemic, many investment properties are not open to the public. This has been tricky to navigate since investors do not want to buy a property they cannot see. While virtual showings are now popular, this can bring unexpected problems.

Water Stains

Water damage to a building can take thousands of dollars to fix. Water rings and mold can be easy to miss if not pointed out. Caspar Chou examines multiple parts of a structure to spot the evidence.

Old HVAC Units

A new HVAC system is a hefty investment for anyone. Caspar Chou recommends inspecting the HVAC system personally to determine how old it is. HVAC systems over 20 years old are much more likely to break down or need routine repairs.

Communal Floor Plans

This is not always a red flag, depending on how the investor wants to use a space. For investors who want to rent out rooms, communal living spaces where multiple tenants share a bathroom can be problematic.

Emotional Sellers

Sellers who are still very attached to their property can be difficult during the negotiation process. They may ask for more than the property worth or make unreasonable demands.

What Happens If A Seller Does Not Want Outside Inspection?

Sellers are not forced to allow prospective buyers to view their property. There are various reasons why someone wouldn’t want their house inspected, but they typically do not inspire confidence.

Final Thoughts

Research is one of the number 1 antidotes for problematic real estate. The more an investor knows about the property, the less likely they will make a mistake. To avoid red flags when finding a perfect property, asking questions will help.



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Caspar Chou

Caspar Chou

Real Estate Investor & Developer located in Alhambra, California.