Knowing the difference between a good deal and a bad deal is essential if you expect to invest in real estate for the long-term. Some are naturals at recognizing deals, and others… not so much. Either way, the skill can be learned through the right real estate investing education and real world experience.
The educated real estate investor answer to just about any investing question is, “It depends.” The question, “Is this a good deal?” is no exception. The answer depends on the investor’s goals and intent.
Is the goal cash or cash-flow?
Is the intent to invest long-term or flip quickly?
These are important questions to be addressed before the original question, “Is this a good deal?” can be accurately answered. However, a quick analysis to determine a clear initial opinion of “good deal” or “bad deal” can be had by using a simple acronym that was taught to me years ago… C.L.E.A.R. I still use it today.