Residential and commercial properties have been bought across the world for different reasons like accommodation and investment purposes. Buyers, who are buying assets to execute their personal needs, are known as conventional buyers. Whereas buyers purchasing assets to rent out and resell on higher prices for earning profits named as real estate investors. The easiness of earning profits with real estate investments as compared to other business sectors is the major allure for everyone. Even conventional home buyers possessing enough funds do not show hesitation buying assets for investment purposes. Because of its simplicity, common people think that buying assets for investment purposes is like becoming a home owner. And to some extent its right but things are different actually. Those who are going to buy investment properties first time in their life must consider few basic things in their mind like mortgages, taxes and insurance to estimate the appropriate cost of carrying the property. In order to maximize the probability of making profits, you must be aware of few essential investment tactics and fundamental of investing in real estate sector.
Success tips for buying investment properties
New comers going to make their first investment in real estate sector could benefit themselves while following few simple tips for buying investment properties. This way they can efficiently reduces the risks of failures.
- According to experts, the right time for buying an investment property is when the prices are low as you can get mortgages with lowest interest rates. It has observed that oversupply in the market significantly reduces asset prices allowing prospective buyers to further negotiate on prices. That’s why it is necessary observing market to obtain latest updates about property prices.
- Don’t compromise on location. It has been observed that successful investors prefer buying assets in prime locations. While buying an investment property, consider buying the unit in neighborhood, where property rents are high while supply is low. Don’t invest in rural areas with lower rents. It’s better if you take some time to observe the location to know some basic facts about specific community you are considering for buying you investment asset.
- Organizing finances in advance has become mandatory for buying investment property. It has observed that professional investors align their finances prior to finalize the deal. Stacking funds before searching the suitable investment option gives you the confidence of finalizing the deal as soon as the opportunity presents itself. This is why professional investors are always looking to arrange funds for their next investment. Managing funds on priority makes you confident and enable you to take quick and right decision. For new investors it is suggested to arrange mortgages payments for six months. Because it may take some time to find suitable tenant and buyer for your asset.
- Nascent buyers, who are making their first investment, are advised to consult with expert or professionals to avoid scams and failures. Professionals could empower you to make right decision on right time. They can give you better advices and ideas about buying investment properties. Or even a family member or friend who already has experience of investing in property market could be your mentor.
The success of buying investment properties mainly depends on your understanding with fundamentals of buying properties. If you follow the simple tips you will reveal the secret of real estate investments. Furthermore, if you have finances, practical knowledge and good relationship with other investors, you will successfully buy your investment property.
Daniel Marshel is senior real estate consultant associated with Better Homes, a leading real estate firm in Dubai, UAE. His firm Better Homes offers online Dubai residential property listings including Dubai real estate, Dubai Properties and much more.