Why Property Is A Good Investment For Anyone
At some time or another, investment possibilities and options cross everyone’s mind. Making quality investment while you are young and throughout your life can make a massive difference when you reach retirement age. If you invest in your twenties, your investments have time plenty of time to grow and increase in value and what’s more, you have time to make mistakes and learn from them. Some smart, early investments include things like Index Funds, Exchange-traded funds, and Investment apps. Once you are ready to make a bigger investment, buying a property could be just the thing.
Stability
Property investment is still seen as a financially stable investment, despite the recent uncertainty in not only South Africa but also the rest of the world. It is a smart investment to make when one considers that you are assuring yourself of a monthly income for the duration of the lease agreement. You do need to remember, however, that property comes with a responsibility. Depending on the property you purchase, additional capital might need to be pushed into upgrading it and making it attractive for potential renters. You will also have to maintain the property and care for it so it can be of constant value to you and keep providing you with a source of income. It can also take a fair bit of initial capital to initially buy the property and though you might not see the return on investment immediately, it is traditionally an investment you make with a considerable amount of time in mind.
Don’t rest on your laurels
Possibly one of the best pieces of advice one can receive when investing in property is to not become complacent. This is true from numerous different aspects.
When you start looking into the property market for an investment property, don’t just go with the first best property you see. Do take a bit of time to properly suss out the current market and understand it. This is potentially your first step towards an investment portfolio that can grow and expand over many years, the more you understand from the get-go, the better for you. There are different trends in different areas that will come and go over time concerning properties that do well and lease out easily. Knowing the trends and staying on top of them will help you tremendously with your first and future purchases. Also, take the time to shop around for home loans. Different banks have different lending criteria and it’s important that you find the one that will work the best for you and give you the best interest rate.
If you have already bought a property and you’re leasing it out, don’t think you have done all you need to. Take the time to upskill yourself about all things related to property investment and management training. Having a comprehensive understanding of your investment and the economy in which you make it only puts you in a better position to foresee potential problems that can originate from various sources inside and outside the property market. It also helps you grow the investment, and not be taken for a ride. If you can effectively manage your investment, you maintain it, and you set the right rent prices for the current market, property has proven to far exceed other investment types when appreciation in value is concerned.
You don’t have to be an investment or economic expert to start investing in property, but it is only beneficial to teach yourself more and understand the bigger picture.
More than one option
When property investment is something you can realistically look at, you need to decide exactly what it is you want from the investment. Though it is more often than not a long-term investment, there are individuals that successfully flip houses. If this is what you want to do, you need to have several things in place and also know your markets very well. It doesn’t help to buy a house, renovate it, and then not be able to sell it because it is in the wrong neighbourhood or it is not the type of house people are looking to buy at the moment. It also requires a lot of capital upfront to allow you to purchase and renovate in a short amount of time and then sell quickly. It can be a bit of a gamble and should always be done with careful consideration of all aspects involved.
Final thoughts
Property investment is not the cheapest investment to make, especially for young people starting off in life. If you do have the capital to do so, however, it is highly recommended as a stable long-term investment that can ultimately provide you with excellent returns on your investment.