These days, there seems to be a global increase in investments in the real estate sector. Investors are looking for ways to expand their holdings beyond stocks, bonds, and funds, and property investment is becoming increasingly popular.
Be it residential property or commercial property, whether you plan on renting it out or fixing the house and then re-selling it, putting your money into real estate has a series of advantages that makes it an attractive option for investors.
- You Can Increase the Value of Your Asset
With real estate property, you are able to take actions that can increase the value of your investment even further. This sets property apart from funds, stocks, or bonds, which investors have little control over once purchased.
The most cost-effective way to improve your property value is via a cosmetic renovation — this could mean repainting the property, redesigning the kitchen, or taking care of the garden. A more expensive and time-consuming way of doing this is by further developing your property, such as by adding new units and rooms.
- You Control Your Investment
When it comes to real estate management, you are the boss. There are few investment fields where you have as much control, influence, and authority as you do in real estate. You decide what kind of property you want, you decide what your property should look like, and you decide whether you want to sell it on or rent it out.
This level of complete control that property investment offers you is significant. It allows you to not only influence the asset’s worth but also the cash flow, by raising the sale price or the rent. Your investment, your decision.
- You Don’t Need to Be an Expert (But it Helps)
The real estate market is accessible to people from all walks of life. You don’t need a special background or a university degree to understand how property investment works. All you need here is an open mind, some capital, and a basic understanding of the economy.
As always, a good place to start educating yourself is the internet. A simple Google search will provide you with key information and answers to following essential questions:
1. “Is the property in a good location?”
2. “What is the crime rate in this neighbourhood?”
3. “What is the average rent in this area?”
You can also get expert advice from experienced sector specialists, such as real estate agents, mortgage brokers or fellow property investors, and. Another great tool that is available to investors is property portfolio management software.
This isn’t to say that property investment is without risk. It’s essential that you are prepared for potential expenses, including interest rate increases, bad tenants, property repair and maintenance bills. You should know beforehand what kind of expenses you might run into and what types of financial risks to expect.
What sets property investment apart from other forms of investment is that the risks are manageable, and to some extent, controllable. For this reason, property investment will remain an attractive option to savvy investors for the foreseeable future.
Yaakov Smith is an entrepreneur who is passionate about providing creative solutions to everyday business issues. He is the owner and founding manager of Logican Solutions Ltd, offering a range of industry-specific products, including claims management, debt management and property portfolio management.
Author: Christopher Walkey
Founder of Estate Agent Networking and an internationally invited speaker on how to build online target audiences using Twitter and LinkedIn.