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due diligence definition in real estate investment.

Due Diligence

Are you a first time real estate investor?
Use our glossary to get to know the terms used in the real estate investing industry.

WHAT IS DUE DILIGENCE IN REAL ESTATE INVESTING?

In the simplest of terms, due diligence is the process of making sure a real estate investment opportunity is viable.

Beyond simple terms, due diligence is a thorough process that involves multiple steps and multiple people to assess the potential risks and benefits of investment in said property.

The basic steps involved in real estate investment due diligence are:

  1. Investment Property Screening

  2. Financial Analysis

  3. Physical Inspection

  4. Legal Review

  5. Financial and Tax Review

  6. Market Comparables and Valuation

  7. Negotiation and Purchase Agreement

  8. Final Review and Closing

  9. Post-Purchase Activities

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