The current downturn in property prices makes investing in real estate alluring even for those who have not tried it before. With property prices at historic lows, any investment made in real estate is bound to fetch handsome returns if you are willing to wait for the upswing. While all real estate advice focuses on location, the other key to maximizing returns when you invest in real estate is timing. Of course a great location is essential to any real estate investment. If you invest in a poor location because of other factors such as a more spacious house or a well-kept garden, you are simply bidding goodbye to your investment amount. A poor location is something that one cannot rectify later. So take care to examine the town planning papers for the location of your choice. This will give you an idea of future projects that might come up in this area. You need to evaluate whether these future projects will enhance or depreciate the value of homes in the neighborhood. A new school is likely to increase the value of your property while a new mall might not do that.
Real property investing is only for the people who have the money to make a substantial down payment as well as a regular income to make the mortgage payments. Examine your finances carefully to ensure that you meet these criteria before you start looking for properties to invest in. You also need to have the financial security to wait until the market rebounds and you can cash in on your investment, making a tidy profit.
As a real estate investor, you need to be able to carry out both minor and major repairs either by yourself or through a good technician. This is because, as a landlord, the onus is on you to maintain the property properly even if you rent it our. If you are planning to rent out the property you purchase, you need to know how much rent it is likely to fetch. Enquire with local real estate agencies about the prevailing rental rates and ensure that this will cover your mortgage payments as well as property taxes. Do not expect to make a profit from the rent, your profit will be realized when you sell the property at a higher value once the market rebounds. This piece of real estate advice holds good for those investing in commercial real property as well.
Commercial properties too need to be well located – only the location requirements vary. By investing in commercial property in a business district, you will be able to realize handsome profits on your investment. Apart from being close to public transport options, commercial properties that have sufficient reserved car parking space will command a premium in both rental and resale markets.
