Property investment can be very lucrative when you know how to do it right. Perhaps you’re looking for another or an additional career. Perhaps you’ve been given an inheritance and you want to invest it somewhere that will continue to make money for you. No matter what your reasons for wanting to get into property investment, you’ll need to do your research first. Here are a few tips to get you started.
Know the Market
You’re probably already aware that the market changes quicker than you can prepare for. One minute it’s an ample time to buy and the next you’ll be sky high in fees and top prices. It’s best to do your research into how the market is looking, whether you’re buying in the UK or abroad. Consider whether you want to buy a property, refurbish it and sell it on or buy to let. You’ll need to look at two separate markets and analyse which is more likely to bring you interest on your investment. Buy to let could bring in a long-term income, whereas refurbishment and selling on could bring in a lump sum.
Location is an essential part of planning for property investment. Just because you’re a beginner, it doesn’t mean you have to invest in your own country. There are plenty of opportunities to invest abroad at hdb resale price. However, no matter which country you want to invest in, you’ll need to know the best performing areas before viewing properties. If you intend on buying a vacation property for yourself and your family and renting it out during the months it’s not in use, you’ll have to consider the areas that are doing well and the areas you already know well from previous visits.
Your Target Tenant
Knowing the type of tenant you want to attract will also help you define the type of property and location to look at. For example, you may want to look at properties close to schools and universities if you want to attract student tenants. If you’re not keen on the idea of accepting tenants who receive government benefits, you may want to look at properties in a higher price range. Would you prefer families or couples? The more you know about your tenant profile, the easier it will be to choose a property that will attract them.
An Exit Strategy
Property investment isn’t for everyone. Becoming a landlord can be a very difficult task, especially if you come across tenants who don’t want to play by the rules. So, having an exit strategy in place is important if there ever comes a time where you want to take the money and run. You’ll need to know when the best times for selling are by keeping a close eye on the market. Exiting a property investment at the best time will ensure you get the peak price for your property.
Real Estate Help
You don’t have to do all the work by yourself. Sometimes, being a private landlord can take the middleman out and uncomplicate the whole process, but it’s also time consuming. Recruiting the help of an estate agent is a great way to free up your time to work on your portfolio, should you need to. Estate agents can do their best to advertise a property to the appropriate audience and make sure there are no gaps between tenants. The longer the gap, the more you’ll end up paying out of your own pocket.
Don’t Forget About Tax
Sadly, there are many first-time property investors that forget about the probability of having to pay tax. Student properties are exempt from stamp duty, but other types of property over the value of £40,000 are eligible for the tax. Don’t get caught short by forgetting to calculate the tax that would be owed on your property. Any financial advisor worth their weight in gold will be able to calculate the exact sum you’ll be liable to pay on any property you wish to invest in.
Double Check Everything
You may take it for granted that estate agents know what they’re doing and provide a trustworthy service. You may take a basic survey to mean that the property is in good condition. However, these things aren’t always true. Always research the people you work with and get recommendations. And, always do thorough checks in every potential property you want invest in. Assuming you can trust everyone may end up breaking your bank.
Property investment isn’t for the faint of heart, but it can be highly rewarding.