Making the choice to become an experienced investor in real estate isn’t an easy decision. Does it require much thinking, planning and consideration to make sure you’re making the right choice.
If you are also having trouble deciding whether developing your property is the best choice for you, the following questions can assist you in putting all your worries to the side:
- What is property investment?
There are a myriad of misconceptions surrounding the investment in property and what it actually entails. The most popular method you’ll come across and even hear about is renovation. In this case, you buy a home for the purpose of transforming the work and then selling it.
But, despite the fact that this market was profitable during the real estate boom in 2007, this method of investing has proven to be less successful in times of economic decline. This is, unless you’ve sufficient money to transform the property quickly and return it to the market.
The alternative route which we suggest to you is to buy-to-let. Buy-to-let lets you make investments in properties that is based on the area’s demand for tenancies and the potential to generate positive cash flows and also generate month-to-month earnings by leasing your construction to tenants. There is no requirement selling…
- What distinguishes property investment from shares, bonds, or stocks?
It is a fact that they cannot ever reach the realm of zero value! Although bonds, stocks, and shares may allow you achieve annual returns of as high as 25 percent, they’re also susceptible to dropping to -8% and leaving you without a pocket.
In the case of property, it’s an entirely different story. Even in times of economic downturn, properties can generate annual returns of as high as 25% when you are investing correctly, this makes it a more secure and stable investment choice.
- Do I require money for investing?
No. Make sure you are equipped with the best methods, and it’s feasible to purchase properties with a small portion of your funds and buy properties without putting your personal property at risk.
Strategies for investing such as No money Down or no deposit Down are designed specifically to make it easier for you to invest without any costs. All you need to think about is costs for legal and stamp duty but even so, you can negotiate discounts for your property so which your property will in essence be able to pay for itself.
- Do I require any prior experience?
Contrary to what the media would want you to believe that you do not need to have previous property investment experience to earn a money from your properties.
The most important thing to make long-term financial success is to ensure that your portfolio is stocked with the appropriate strategies for investment; negotiate most appropriate property price discounts and, most importantly, make sure that you invest in properties that can provide the positive cash flow and the tenancy demand you want.
A property development course can equip you with investment strategies. Make sure to take the time to research these courses, then look up their case studies/history and only register for the course that will give you at minimum five investment strategies.
Remember that not all investment strategies be successful in every financial environment that’s why having a wide range of options could help.
- What is the process banks use to provide money to investors for investment properties?
As opposed to the mortgage application process where the amount you lend is determined on the amount you earn an investment in buy-to-let is viewed in a very different manner.
All lenders will require is that the property be capable of generating 125% of mortgage payments through buy-to-let. So, make the right choice and you can make investments in larger and better homes than you could in the event of the amount of your salary.
- Which are the top investments in properties?
There isn’t a set formula for this however residential properties most often win in investment stakes compared to commercial properties and land.
When researching possible development opportunities, the most important factors to consider are the demand for tenancy on the property and mortgage deals that are in place and the positive cash that the property will produce. If there’s demand and the property is able to generate at the minimum PS300 or more in cash flows, it doesn’t matter if the property is a semi-detached, terraced or detached.
The fact is that economic conditions can cause one type of property to be more popular than another. In the times of recession, for instance research showed that tenants prefer living in terraced houses over any other type of property because they were more attractive and were more energy efficient.
- Positive money flow?
Positive cash is essentially the money that is leftover from tenants rent after mortgage payment has been deducted. Therefore, the greater the property’s positive cash flow and the higher the profit the property will be.
- Can you invest in any financial climate?
Yes. If you’re planning to specifically enter the property market by using the appropriate strategy for investing as well as brokers and negotiation skills it is possible to invest in the property market regardless of economic turmoil.
The recession of the past few years is a prime example. In the past two years we’ve been faced with property price reductions that are minimum 20%; low base rates of 0.5 percent, and a demand for tenancy that has grown by 24% during the final third quarter in 2009.
But, despite the boom in property prices of 2007 the property market was a an asset that was a powerful one as it facilitated rapid growth in capital that in turn led to higher rents and more positively flowing cashflows.
The current financial situation does not have to play a role in the decision you make to invest. only assist you in determining which investment strategies will yield the greatest results.
- Can you invest in foreign markets?
Your property portfolio doesn’t need to be restricted to one region, city or even country. UK, USA, Europe or Australia… With the right strategy, all properties can be converted into reputable rental properties.
The only thing to be wary of when making investments abroad is to familiarize your self with the property laws of each country and investment rules. Every country operates with an individual system and uses different approaches to arrange repayments, lending and structuring the leasing of property. tembusu grand