When it comes to investing in property, any time is always a good time. When you invest, chances are you won’t incur a loss unless you play your cards badly. Hence, many people worldwide invest their wealth into property because there is little to no depreciation on the land. The value rarely fluctuates, making it a great way to make an investment that gives favorable returns.
However, the thing with the land is that you need a pretty sizeable investment. The investment needs to be worthwhile, and it would be best if you kept a realistic time frame for the returns.
If you are new to investment, especially property, this article will discuss a few things that you can consider. By the end of this short read, you should have a better idea of where to spend your money and what the returns might look like.
Here are five ways of making smart property investments.
Factor in land tax
When it comes to predicting the cost of investment, some people forget to factor in the land tax. Depending on the property’s location, the land tax may amount to a sizeable figure if you ignore it.
You might want to educate yourself on property tax and everything related. Investors often segway into a career in taxation after learning the basics. Millions of investors and businessmen have returned to college with easy access to online education to add to their credentials. A masters in taxation no gmat is best for someone who wants to learn how to utilize their finances in the most efficient way possible. The optimum way to maximize your profits is keeping taxes low (legally) and focusing on the best possible ROI. Just make sure you know a thing or two about taxes before investing.
Check out a few options
Please don’t invest in the first piece of construction or land you see. One of the biggest mistakes people make is jumping the gun and spending their money on the first option. Sure, it may seem like the right thing at the moment, but at least check out the other options. What If there was something better just a few blocks down the road!
Some property options trump others. One house may have a better location while the other may have better fittings. Try to find the best bang for your buck. The only way you can do that is to go shopping and gauge which option will give you the best ROI.
‘Like anything, property investment is an experience that differs from person to person – so it’s vital that you also determine which strategy is best for you and your budget.
One of the most popular approaches is investing in off-plan property.
These properties are still in the planning or construction stages but are still available for purchase. Whilst this may seem a little silly to do, it is, in fact, one of the most affordable methods of buying rental property at the moment.
To offset any feelings of doubt, off-plan properties are typically placed at below-market value rates – something that might be encouraging for the investor looking to make the most of their money.
Alongside this, with the property being a new build, it’s likely to have good value due to increasing demand from renters looking for contemporary designs and features. The fact that it will not have been lived in or ruined by previous tenants is also sure to be a highlight.
The biggest downside, of course, is that it may be a long time before you can start seeing any returns on your investment, as you will have to wait until the property is fully built.
However, if you’re patient enough, it could be the perfect choice for those looking to maximise their earnings and save a bit of money at the same time.‘
Put some money into the property
Flipping houses isn’t just a trend; it’s something that people make a living off of. Buy a rundown house for cheap, renovate it with a reasonable budget and sell it at a higher rate.
The benefit of flipping houses is that you control all the negotiations and stand to create higher margins for yourself. Moreover, as the budget for renovation is in your hands, you know where you can realistically cut corners.
The margins in flipping houses are astronomical. You can easily walk away with 50-150k depending on what kind of property and budget you are looking at. Hence the reason why so many people are doing it nowadays.
Location, location, location.
When investing in property, remember that you can’t go wrong with a property in a hot location. Not only does the value of the land rise in value quickly, but you will also have more offers than a less valuable location.
Even if the house isn’t in the best shape, you still stand to profit from it. People are always looking for fixer-uppers that they can slowly work on. Therefore, regardless of what condition the house is in, if it’s situated in a nice neighborhood, not too far from the middle of town, chances are you will make a profit on it.
Hence, you should do your research and find what parts of town have the best locations. Find cheaper properties in expensive areas and wait till the buyers flood you with offers.
If you are looking for the best return on investment, please keep your expectations realistic. If you expect the property’s value to skyrocket in the next few months, that’s probably not going to happen.
To get the best returns, you want to keep a fair amount of time in mind. The longer you wait, the more the property’s value is likely to mature. Once it reaches a good deal, you can consider selling it.
Buying, holding, and selling it a few months later barely gets you a substantial profit. If you want something significant, wait, watch the market, wait for the signs and then sell.
This article has highlighted innovative yet simple ways of making property investments. We have been over everything from flipping houses to finding the best location. It would be wise to follow some of these tips as they stand to make you a fair amount of profit if you play your cards right.
With that said, make sure you don’t overthink and hold off on investing. Take a leap of faith when you need to; that’s what investing is all about.
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