Here, Frank Jermusek shares with you some of the most common mistake real estate investors make, especially when the market is extremely active.

1. C O M M O N M I S TA K E S
R E A L E S TAT E I N V E S T O R S M A K E
F R A N K J E R M U S E K :

2. B E E X T R A C A R E F U L
D U R I N G A N A C T I V E
M A R K E T
• Right now the real estate market is
extremely active, which means that
bidding is becoming more and more
competitive.
• This is stressful time for investors, so
it’s vital that they steer clear from
making real estate mistakes, which
could lead to overpaying for a piece
of property or buying up assets
indiscriminately.
• Those who are new to commercial
real estate or veteran agents who are
trying out a new investment strategy
should especially pay critical
attention to their actions.

3. I N T E R V I E W F R O M
N AT I O N A L R E A L
E S TAT E I N V E S T O R
• In a recent interview conducted by
National Real Estate Investor with
Robert J.M. Occhiogrossi, the
managing director of IVI Assessment
Services, Christopher Macke of
American Realty Advisors, and
Nicholas Coo, managing director of
Faris Lee Investments, brokers were
asked about the most common
mistakes in real estate at pivitol market
points.
• Here are a few common mistakes that
are generally made at this time of year
that investors should make sure to take
note of…

4. P E R F O R M I N G I N C O M P L E T E
D I L I G E N C E
• The first mistake is performing incomplete diligence, which means that buyers will cut their process short for
various constraints like time.
• When investment processes are cut short, important information can be missed and an investor will be
unpleasantly surprised in time. Remember, making a commercial real estate investment is a long process and no
amount of details should be missed.
• According to Occhiogrossi, other mistakes involving this process include performing “‘inadequate level of due
diligence to evaluate existing collateral and waiving rights to perform due diligence of vertical components,
particularly in portfolio situations,’” (Misonzhnik, 8 Most Common Mistakes Real Estate Investors Make).
M I S TA K E
# 1

5. N E W LY C O N S T R U C T E D
B U I L D I N G S H AV E N O
P R O B L E M S
• Another mistake often made by
investors when the market is really active
is that they assume newly constructed
buildings have zero problems.
• Just because a building is new, does not
mean that it does not have any
problems.
• In fact, newer building sometimes have
more problems than ones that have
been around for years.
• This is because builders generally rush
to complete developments when the
market is booming, which leads to
defects in construction plans from hiring
less qualified workers.
M I S TA K E
# 2

6. F O C U S I N G O N T H E S H O R T- T E R M
• Lastly, investors will often focus on short-term noise instead of long-term signals, particularly
when they are looking to profit from the real estate investment right away.
• According to Chris Mack, “Focusing on short-term ‘noise,’ whether it be the daily
speculations surrounding Fed policies or daily gyration in the stock market, as opposed to
the underlying factors that actually drive commercial real estate returns such as employment
growth, capital flows into commercial real estate and property fundamentals is another
common mistake,” (Misonzhnik, 8 Most Common Mistakes Real Estate Investors Make).
M I S TA K E
# 3

7. For more information about the mistakes commercial real estate investors
make, read National Real Estate Investor’s article here