Skip to main content
No. of Recommendations: 13
While individually owned real estate may have significant advantages, there are disadvantages as well.

Lack of diversification at the property and tenant levels.

1) at the property level, if the local economy declines, or even just gets overbuilt, returns will suffer.

2) Tenant diversification. Back when I was a loan officer I probably dealt with 10-12 real estate investors, only two did really well, 2-3 did ok and the rest did poorly, all in pretty much a single real estate market. One of the two that did really well was a master at screening tenants, one bad tenant can takes years of profits.

3) As previously mentioned there are hassles in directly running a business or rental properties.
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.