Many are starting to learn about investment in properties. It is easy to understand why. The value of our money is getting smaller, a phenomenon called inflation. During inflation, everything that money can buy becomes more expensive and property is one of them. In addition, property millionaires always made it to Forbes Rich List annually.
To hedge against inflation, majority of people make investment in properties. This is because the price of property increases with time, also known as capital appreciation. However, depending on which country you reside, you will need to pay real property gains tax when you sell the property. Some prefers investment in rental property whereby you receive income on a monthly basis. Regardless of whether you are investing in property for capital appreciation or rental income, it is good to take a look at the investment from the following areas. In this article, I will focus more on rental property.
1. Location, location, location
This has been the mantra of most, if not all, property investors. The location of your property will determine if the property price will increase with time and if tenant is fast to come by. To know if your chosen property location is a good one, make sure it is in close proximity to universities, public transportation, industrial areas and a pretty established town ship. Suffice to say, your tenant will come in the form of students and outstation job seekers in the industrial areas.
2. The profit is in the purchase
It will be helpful if you know and keep track of the prices of property in your chosen location. Look at the classified ads section, foreclosure notice and even at bank auction property list. Compare the asking price to that stored your database. Once you have located one property that is at least 15% lower than the prevailing market rate price, buy it! Buying properties at below market price will ensure better return for your real estate investment.
3. Work Hard
Now that you have determined the location and the best entry price for your first investment property, what is there to do next? Firstly, get it rented out of course. There are many channels to rent out a property. You may post it on the classified ads section, the notice board of nearby convenience store; ask your friends to spread the word around that you have a property to let, and now Facebook is getting popular too. Be creative and innovative.
4. Patience is a virtue
After putting up notices for rent and spreading the news, all we can do now is to wait. And patience is a virtue for property investors, especially Property Millionaires.
5. Keep a network of professionals
As you learn the ropes of being a Property Millionaire, you will come across professionals related in this industry such as Bankers, Conveyance Lawyers, Real Estate Negotiators and also other investors. These are your professional networks who will be your friends. Keep in touch and share information with each other.