Securing a future for family is exactly what every man wants, and how they you achieve this? I am pretty sure you will agree with me when I say; the most convincing way of securing a bright future is through investments.
You might have secured yourself a good job, but that will not secure something big enough for your dreams, you need something that is more promising, and there is where investments come in. Think of something like a condominium; it is a property investment that is likely to make good earning for you every year.
Property investment is by far the best investment you can think of.
Well, there are a million and one ways that you can invest in but one of the most assuring investments you can find is property investment. Just like any other business, you need to learn the correct procedure for doing it. For this reason, I have created an investment property guide covering everything you need to know about property investment.
Setting your Investment Objectives
It is important that you include objectives in your property investment plan. These objectives will be of great help when making the critical decisions.
The same objectives will help you in managing the property. Okay, I don’t know what exactly your investments plans are, but I can bet they revolve around some objectives, be sure to set your objectives before investing in property. When setting your objectives, consider asking yourself questions like:
- How long do I want to hold the property?
- What return rate do I expect?
- How much am I willing to invest in property?
- How much monthly instalments am I willing to pay?
- Will I be able to manage any losses that occur?
Now that your objectives are set, it’s time to invest in property but before that, let us look at some of the reasons why you should invest in property.
- Property has more guaranteed return
As I had mentioned earlier, property investment has more promising returns than any other investment. Looking at the dividend you get from real estates, you can testify that, not even the bonds or stocks can beat property investment.
- Stable inflation hedging
As economies grow, the demand for rentals and real estate increases. This means that the money you get from your condominium is continuously increasing with time and after a few years you don’t have to be employed anymore.
iii. High tangible asset value
Properties provide a very high tangible asset value compared to stocks and other investment. With property investment, you will get to leave your kids something real.
- Power to finance other investments
Property investment attracts a lot of gains that can be used to finance other investments. You can use the income it gives you or choose to leverage. Apart from the handsome gains, property investments propel your other investments since you don’t have to spend much time managing the real estate.
- Portfolio Diversification
A skilled investor will always consider the investment with a higher return per unit risk like the real estate. So, adding a property investment to a portfolio of diversified investments or assets will yield to a lower portfolio volatility.
- Easy to obtain finance
Obtaining money to finance a property investment is much easier. This is because it offers a stable and attractive income return, lenders will easily lend on residential properties than any other property. Investing in property does not necessarily mean you need to have the full amount to achieve that condominium, all you need is a down payment!
vii. Fits every budget
Property investment is not locked within certain brackets; it fits in each budget. If you are a heavy investor, you have the privilege to renovate the property to a classy and expensive premises. Look at this way, you have purchased an old klang road condo, and you realise that it could make you more money if it is furnished to fit the working individuals nearby.
viii. Government support
Every government wants the price of rental prices to remain robust. For this reason, they will not bring into legislation a hefty crease in the cost of owning a residential property.
What to look for in an investment property
When investing in real estates, you just don’t invest; there are a couple of things that should be considered when making the investment. These are the factors that unleash the value of the property. Below, I have listed the most important considerations to make when investing in property.
- a) Location
The location of the property is very important, and it will determine how much you will make from the property. The location also sets your target market dictating whether your property will be on demand or not. For instance, a property located near MRT or LRT will be of greater value than a property of the same type located in a very remote area. Having that in mind, be sure to research the location’s historical appreciation.
- b) Potential property returns
Different properties attract different tenant profiles. The returns of that property that you are just about to invest in will be determined by the rental value of similar properties in the area. The potential property returns contribute greatly to the property value.
- c) Property size and type
Apart from the location and property returns, the size and type of property also describes the value of the property. A spacious condominium is likely to be of more great value compared to a one-bedroom rental house.
- d) Cash flow Attracted by the Property
This concerns the rate at which property is likely to generate cash. Properties that convert money in a shorter period are of great value. In most cases, this aspect greatly depends on the type of the property and also the location.
Well, if you are looking forward to selling your property, these are the same considerations to make when deciding on the price to sell.
We have looked at the most important things that you need to know when investing in property. Well, after such a long discussion, you will agree with me when I say that you will never go wrong with property investments. It has no retirement, stable source of income and also secures something tangible for your family.