Investing in real estate is some kind a business that you need to work at it to bring yourself a significant profit/ revenue. I’ve have been attended so many property Malaysia investment seminars, and I realized that most speakers like to say “Cash flow is KING” and the first thing you had to do is generating income. Once you have your stable income stream and an excellent savings in the bank account (but most preferable that you got lot of cash in hand), then you can only focus on hitting home runs with larger deals, flips, or rental property.
In order to generate the stable income, obviously you must have a stable job at first, either its monthly salary or commission. It is strongly not recommended to quit your existing job outright to start into real estate investing. No way! Unless you’ve have been successful in this field.
Well, in order to succeed in real estate investment field, here we giving you the top 3 ways to make money in real estate. If you are the newbie in this field, this is the very good article that you should continue read on to figure out which one suit to your portfolio.
1. Residential Property
It is a best choice to get started your investment journey. Do note that when hunting for the residential properties, location is often the biggest factor in appreciation. For example, the property neighborhood around the public transportation, schools, shopping malls, playgrounds, future development plan and many more. Alternatively, if the property’s neighborhood is bad or not much developments and amenities, the appreciation of property itself is not so ideally and its most likely will caused you lose money. Do invest in residential property widely.
Besides, property improvements can also stimulate appreciation. You can just beautify the bathroom, flooring and remodeling to an open concept kitchen are just some of the common methods a property owner will try to increase the value of a property. Many of these strategies have been refined to high-return fixes by property flippers who specialized in adding value to a property in a short period of time.
2. Raw Land
The most obvious source of appreciation for undeveloped land is, developing it. Due to cities expanding, land outside the limits becomes more and more valuable because of the potential for it to be purchased by developers. Then the developers will build houses that raise that value even higher.
Besides of that, appreciation in land can also come from discoveries of valuable materials or minerals, provided that the buyer holds the rights. An extreme example of this would be striking oil, but its appreciation can also come from gravel deposits, trees and so forth.
3. Commercial Property
The factors in appreciations are same with the residential property, location, future development in the area and improvements. The best commercial properties are in demand, and that drives the price up on them. However, investing in commercial property is quite risky compare to residential property.
Additionally, commercial property is quite sensitive to economic changes, if there is high points of the economic cycle, the property owner will get the excellent return on commercial rental while the rental rate will goes down if the economy is low. (Click here to read more about Residential property vs Commercial property).
To choose whether which ways suit to you portfolio, you will have to set a short and long-term investment goals and objectives and make sure these goals are realistic and clear.