When it comes to picking the right investment plan, Real estate investment surely tops the chart. But then, there are different parts to it. Before you venture into any business, it is imperative to know its rudiments, what it requires, its fails and gains, and the necessary sacrifices you might have to make.
No matter how ‘juicy’ or ‘fantastic’ a business is, you have to put it into thorough consideration. In real estate investment, there is the Physical Real Estate Investment which simply refers to real estate property that belongs to the owner as a physical structure such as Residential property, Commercial property, and land; and then there is the Indirect Ownership Investment which refers to taking ownership of real estate property without using for residential, commercial, or business purposes. This type of investment include REITs (Real Estate Investment Trusts), Crowdfunding, and Partnership.
So what are the things to put into consideration before venturing into any of these?
How much do you know about the type of investment you want to commit your lump sum to? To prevent hitting rock bottom, you either learn more and make continuous research, or seek the advice and expertise of trusted professionals. Either way, its advisable to learn more.
The location of a property is worth ten times more than the property itself, no matter how beautiful the structure. In real estate, land wins all the time as it is an important factor. Even if there is a sprawling mansion with the best amenities but in an unpleasant location, the property’s value and demand will be less. There are pros and cons for both new and old properties. New properties generally have updated amenities, easy customization, and come at a competitive price. Old properties are more reliable, cheaper, and offer better locations.
You have to peruse through and through the profit-making opportunities. Look ahead and think about any changes in the industry or surrounding location that could influence the property’s valuation. Also, consider alternative strategies that could make you fast cash, like flipping houses.