The real estate arena is easily one of the most lucrative for potential investors. Perhaps more importantly, it’s also a sector which offers the best hopes of steady and sustained growth. After all, the rise in property prices has been far quicker than general inflation rates. And those sentiments are true on a global level as well as a national one. Nonetheless, it’s not a ticket to free money, or else everyone would be an investor. It’s imperative that the right steps are taken in order to make your investment work harder.
Here are four key points of focus that you cannot afford to ignore.
Geographic locations play a huge role in all real estate investments. Some markets are growing far quicker than others. This can be due to improvements in the local area, such as new business prospects, or many other factors. Apart from choosing the right city, you need to select properties with the biggest client appeal. Seaside real estate is a particularly popular option at the moment as it has a universal appeal. The quicker a property can be shifted, the better.
Remember to prioritize location at all times, and you will not regret it.
Single Home V Multi-Home Units
There are many questions to ask while considering your investment options. As an inexperienced investor, you may assume that investing in a single home is easier. However, many lenders on buy-to-let schemes would rather lend to multi-home units. This is because they only need to be partly occupied to break even. Meanwhile, turning a house into flats can work wonders depending on the situation. The additional work is minimal but the extra income can be huge.
There is no one right or wrong answer, though. So, do what’s right for you.
Buy-To-Sell V Buy-To-Let
Renting out the property is only one way to go. You could also look to sell the property on. This allows you to gain a profit ASAP but does relinquish the asset. Conversely, a buy-to-let option gives a steady source of revenue while the asset remains in your possession. Of course, landlords do encounter a number of other costs, so you must be careful. Ultimately, the decision will be dictated by your capital, goals, and general feeling towards each property.
Many of the biggest investors will have a mixed portfolio including both types of property.
As an investor, you can be either passive or active. Essentially, you have a choice to hire others to do the work on your behalf or take the DIY approach. Meanwhile, you should consider whether to go for a fixer-upper. Taking this option with can unlock a huge profit in a matter of months, even if you take the passive approach. Once again, it all boils down to personal situations. Juggling time and money in the most efficient manner should unearth the very best outcomes.
The best option is the one that earns the biggest ROI. It truly is that simple.