Many people get confused when it comes to finding out where to invest and how to invest. You tend to run to a real estate agent to ask for advice on how to invest in real estate properties and they will take a cut from your profit (but not your loss). This article will give a quick guideline on what to invest in and what not to, something like a property development training & education course!
WHERE DO I START LOOKING
As a newbie in the property investment business, it is important to realize that you need to start with the smallest possible investment. There are many types of property investments:
- Land investment
What’s more is that the value depends on the area you choose to invest in. You need to select a location which is underdeveloped and looks like it will be developed in the near future. Be one of the first few people to invest in this kind of area (be it land or apartment) and you then play the waiting game. I would not recommend going all out and investing in what just would be a bad investment in a mansion or a factory in an already well-developed area. Apart from the mountain of capital investment you will be required to make, the return on such investments is absolutely minimal compared to how much you spend initially.
CAN I BUILD SOMETHING OF MY OWN
Do not make that mistake as a first time investor. Avoid falling into traps of building up a new apartment block or mansion to sell off as a first time investor. It can be tempting to just fall into this trap, but it is a trap in reality. You will invest so much into it that your focus will move away from your primary business. That is not a good thing at all. It’s like your secondary income has now become your primary objective. You need to avoid falling into such things and focus on the bigger picture. Once you make enough money from these initial investments, then you can venture into a project of your own. And this means around 5-7 years down the line. Yes, that is how long it takes for a real estate investment to have a suitable Return on Investment!
DOES IT REALLY TAKE THAT LONG?
Yes it does. All you are doing is buying the land/apartment and waiting for it to gain value. It is simply like a Fixed Deposit account sitting in a bank, except that this time the returns are higher than just the small percentage you get back from the bank. Do not give up on the investment because you have to wait for it to ‘mature’ before selling it off. If you break it before it matures, you may not get as much as you were hoping for. Stay patient, stay calm and keep the bigger picture in mind. Don’t forget that this is your secondary income, so playing the waiting game should not be a hard thing to do!