The Biggest Risks in Real Estate—and How to Protect Yourself

The real estate industry offers incredible opportunities, but let’s face it—it’s not without its risks. From legal liability to market volatility, every deal comes with a set of challenges that can catch even experienced agents off guard. The good news? Awareness and preparation are your best defenses.

Here are some of the biggest risks real estate professionals face today—and how you can stay protected.

1. Misrepresentation or Failure to Disclose

Whether it’s a foundation issue, a past flooding problem, or a neighbor’s noisy chickens, failure to disclose material facts can land you in legal hot water.

Avoid it:

• Always ask your clients detailed questions about the property’s condition.

• Conduct a thorough visual inspection and document findings.

• When in doubt, disclose it—transparency protects everyone.

2. Improper Handling of Agency Relationships

Agency misunderstandings are one of the top reasons agents face complaints with the North Carolina Real Estate Commission. Dual agency in particular can be tricky if not handled correctly.

Avoid it:

• Use the WWREA Disclosure form early and explain it clearly.

• Always get written consent for dual or designated dual agency.

• Know your fiduciary duties and act accordingly.

3. Contract Errors or Deadlines Missed

From overlooked contingencies to missed due diligence deadlines, paperwork mistakes can derail transactions—and cost your client (and you) big.

Avoid it:

• Use checklists to track deadlines and contingencies.

• Review contracts carefully and consider a second set of eyes.

• Stay current on NCAR form changes and legal updates.

4. Cybersecurity and Wire Fraud

Real estate transactions are prime targets for cybercriminals. Wire fraud scams involving spoofed emails and fake bank instructions are becoming more common.

Avoid it:

• Educate your clients: never wire money without verbal confirmation.

• Use secure platforms for document sharing.

• Keep your devices and passwords protected.

5. Market Volatility and Economic Uncertainty

From interest rate hikes to housing inventory shifts, external forces can affect deals and client expectations.

Avoid it:

• Stay informed with local market data and economic trends.

• Manage client expectations with realistic pricing and timelines.

• Diversify your skill set so you’re prepared for any market.

Stay Sharp with Providence

At Providence Real Estate Education, we believe the best way to manage risk is through education and preparation. Our courses are designed to give you the knowledge, confidence, and tools to navigate a constantly evolving industry—ethically and effectively.

Ready to level up your risk awareness?
Check out our upcoming CE classes. Let’s build your career on a solid, informed foundation.