Protect Yourself: Your Property Investment vs. Economic Worries

property investment

There are so many things to get right when it comes to property investment.

The majority are relatively easy to understand. You know you have to find the right property; secure the right mortgage; have a plan for how you’re going to generate further income from your investment. These are the basics, which most people considering a dabble in the property market will be well familiar with.

Beyond that are the deeper details. Things like the need to diversify your finances and researching areas where you’re going to be able to get the most for your money. That’s a moderate level of financial know-how required, but it has one benefit: it’s still very much in your control. Provided you take the time to educate yourself, you’re not going to go very far wrong.

However, what anyone considering playing with property investment has to be aware of is that some things, you just can’t control. By far the most influential factor on your investment – that you have absolutely no control over – is the economy. Not your personal economy and finances, but the finances of the entire country – perhaps even the world – that you live in.

 

Why Does This Matter?

The health of a housing market has long been seen as one of the factors that is considered when the robustness of an economy is assessed. Economists use house prices, as well as how frequently houses are being bought/sold, as indicators of consumer confidence. After all, if confidence is low – which is generally a bad sign for the economy – then people are more likely to stay put and wait for better days.

While you can strategize and plan for almost everything to do with your property business, the economy is the one area that you definitely and absolutely cannot. It’s beyond your control, but you’re subject to its whims all the same. That’s not fair, but there’s no point getting lost in that point – instead, you have to protect yourself if the economy and consumer confidence goes through a wobble.

 

How Can You Do That?

There are a few basic strengthening solutions you can apply to your property investment mindset, which can help protect you against any countrywide economic turbulence:

  • Don’t overstretch yourself. When you buy, ensure you’re going to be able to pay the mortgage now, and in the future if your income is lessened.
  • Don’t just invest in property; look for land for sale to help diversify your options. If the housing market goes stale, you can survive thanks to a portfolio of different choices. If the market booms, then you can use that land to build on – so you win both ways.
  • Be prepared to sell at any moment. If the housing market is falling and looks set to go lower, then sometimes the safest thing you can do for your future is sell as quickly as possible. Be ready for this at all times, by keeping up to date when it comes to maintenance around the property.

 

Should You Worry?

Given that you can’t control the economic future of the country, to an extent, worrying is pointless. If you follow the above to guarantee that you’re as well prepared as you can be for national economic shots, then you’re in good shape – and that’s about as much as you can home for.

 

Property Investment: How To Get Your Foot In The Door

property investment

 

The idea of having a property portfolio might strike you as something that is only possible for the super rich. You may think that since property is so expensive, the business of making money from it is prohibitively exclusive. It is the sort of thing that you can only do if, like Donald Trump, you were gifted a ‘small loan’ of a million dollars, right? The incumbent president of the United States of America is an interesting example. Despite having every possible advantage in life, he has still had to declare bankruptcy six times. The property market can be tough sometimes but getting started is possible even if you do not have a wealthy father. Here are a few ways that you could make the property investment market work for you:

 

Firstly, it is a myth that you need to have hundreds of thousands of dollars lying around to get into the property market. If you have a stable, well-paying job, and your credit rating is good, it should be quite simple to get a loan. However, before you make the decision to take on a lot of debt, you should first be absolutely sure that you will still be able to support yourself as well as accommodate the expenses of buying another property. A simple way of doing this is by calculating your net worth: make a record of your assets and then subtract any debts that you have. If the number that you are left with is less than zero, you should probably consider waiting for a few years until you are better prepared to shoulder more debt. If you have everything under control, then you should still think carefully. The chance of your investment costing you more than you anticipated could leave you having to make cuts in the rest of your life, cuts which you may not want to make.

 

If you are not sure about exactly how prepared you may be, you should consider speaking to a financial advisor or a mortgage broker. They are experienced at quickly and concisely getting an idea of someone’s financial health and giving their diagnosis. In the event that your finances are in good shape, then you need to decide what sort of property it is in which you should invest. Do you want a family house that would attract a professional, perhaps more reliable clientele, or maybe something small in a more vibrant part of town where you could charge greater rent? Either way, it makes sense to think about hiring property managers. They can tell you how much rent to charge to ensure that you are competitive and people will want to rent for you. They can also help with finding tenants and dealing with all of the paperwork, which leaves you to look towards your next property.

 

The secret to property investment is that success is cumulative. Once you get your first property and rent it out, it will start paying for itself, which allows you to reinvest that money into a new addition to your portfolio. Pretty soon, you will be the property mogul you never thought you could be.

Quick Read Property Investment: Begginer’s Guide

Investing in property is by far one of the best ways you can ever possibly invest. Firstly, because unlike stocks or indices you’ll actually have something physical to show for your expenditure. Secondly, and indeed most importantly, you can make huge financial gains because house prices have been consistently rising for decades. There are many variables involved in making money in the property market, and this article does its best to inform you about the basics in property investment.

 

You can either go for a quick sale after purchase with a company like we buy homes, or hold off for a while and potentially get a better offer through tradition means down the line. Those are the two main ways of selling a home, but you can also rent it out for a passive income, though you won’t recoup your initial investment for quite some time. But, before you make any kind of profit you need to look at the property and work out what can actually make you money.

 

property investment

 

You’re going to start small, and you need to actually think what value you’re going to add? Have you been in the property market so you know exactly what will add to a house’s value? Were you in the construction industry? Or maybe you were a tradesperson and you can do work on the house yourself and so save money on fees. Whatever the reason, you need to be able to add value or if not be great at working out profit margins down to the last detail, you need to get reliable unchangeable quotes from tradespersons to make a reliable prediction otherwise you could be making minimal profit.

 

The primary form of increasing a home’s value is in extension. If you make a major extension to the side of a property, either downstairs or both, you will add a significant amount onto the house. Be wary, these extensions cost well into five figures, depending on what you do, so you need to balance the cost out with the expected return. After this, you can make general improvement, which are popular if you own a flat or apartment. These include getting the kitchen and bathroom up to a better condition, rewiring, changing the floor etc. They sound like small changes, but when coupled together than can increase the value of the house significantly, leaving you with a tidy profit.

 

Work on the garden makes for the lowest form of increase, but if you get some serious landscaping done by yourself or a tradesperson you can add some value to the house. Changing out the windows can help too, especially if they’re old and don’t have double glazing.

 

The final way of increasing value is regarding the ground ownership and planning. You can acquire the leasehold or freehold, meaning the purchaser will actually own the ground of the home instead of having to pay a low yearly rental (depending on who owns it). You can also get planning permission, the application can be quite tough, so getting it done and then selling it onto another developer who has time to build the add ons can be another fruitful way of making a profit in property development.

 

Image credit: www.rentalrealities.com

Property Investment: Why Location Is So Important

We’re sure you’re well aware of the many factors that go into a property investment decision. Among them is the location – one of the most important of them all. Without choosing the right location, you’ll almost certainly be doomed to failure. So, as it’s such an important consideration, we’re going to give you the info you need to know.

 

new-home

 

Reputable Tenants

The last thing you’re going to want to deal with is tenants who won’t pay their rent on time. This is why choosing an attractive location will (hopefully) result in more reliable situations. As with any situation, though, you’ll need to do extensive checks beforehand. There’s plenty of people that will be willing to pay on time in what might be perceived as an unattractive location. In any case, you need to research the market before you make the decision.

 

Attractive Neighborhood

If you want more people to be interested in your property, you want it to be in an attractive neighborhood. Being known as an apartment in the “wrong part of town” isn’t the reputation you need to build. Similarly, there’s a big difference between a secluded house and a house on the side of the road. Your potential takings will differ dramatically based on this, and it’s important to realize this ahead of time.

 

Management Services

The property you’re investing in needs to be reliable, as do the management services that you’ll be using. Good property management means that you’ll have a smooth ride when it comes to tenants and agreements. If you can find a local specialist that can deal with this sort of thing, you’ll be off to a good start. Always try to seek the help of the professionals.

 

Convenient Access

One of the big factors that is often overlooked is how convenient the property is in terms of general access. Tenants are often looking for places where they can easily access public transport, for example. Invest in something that is miles away from anything, and you’re going to struggle to attract interest. How close to the city is it? Can you walk most places, or do you need to use transport? These questions are very important to take into consideration.

 

Demand

Finally, you need to weigh up the demand of interest in the property itself. What’s the market like in the location you’re targeting? What’s the demographic? It’s all well and good investing in luxury property, but what if no-one can afford it in the area? Similarly, investing in something that needs work might not be the best idea in certain neighborhoods. Look at the numbers and determine whether you’ll get any interest if you invest now. Otherwise, you might be waiting a long time before you start making any profits.

 

It’s fair to say that if you pick the wrong location when investing in property, you’re in for a bumpy ride. It’s a rookie mistake to make, and you need to make sure you avoid it. Follow our tips, do extensive research and ensure you make the right decision.

DIfferent Types Of Investment You Could Consider

If you are looking to protect your future finances, you might be considering investing your money. There are lots of different investment options available to you. Ideally, you want to pick a type of investment that you know something about. Or, at the very least, a type of investment that you understand. If you’re not sure where to start then this post will help. We’ll run through the usual types of investment and you can decide which one is right for you. You can also consider saving your money in different accounts, rather than investing it. Hopefully, after a few years it will have picked up some interest. But the interest rates on saving accounts are low at the moment and they aren’t expected to rise any time soon. You could lock your money away for years and ultimately watch as it loses value.

Vintage Investing
Image credit: Chris Potter – https://flic.kr/p/dvZpQL

Gold And Rare Metals

Since depreciation has already been mentioned, we thought we would mention gold and other metals that you can invest in. This is because the main argument for investing in gold is that it is the true form of value. What this means is that gold does not rise or fall in price. Therefore, by investing in gold you will always have as much money as you previously did. However, it’s not going to increase in price either. So while gold is a good way to keep your money safe, it’s not a good way to make more of it. Also, you have to think about storage. Buying gold isn’t like keeping money in a bank, and you can’t very well keep it in your home. This is certainly something to think about if you take this route.

Property Investment

If you’re investing in property, you have two choices. You can either buy to let or property flip. Most people opt for property flipping. By property flipping, you are taking on less responsibility. You will also get interest on your investment sooner rather than later. Unless you have a lot of money tucked away, you will need to take out a loan to pay for purchasing the property. You will also need to think about the cost renovating it and getting it ready for sale. There are a number of different types of real estate finance. But, if you are property flipping you’re probably looking to get a hard money loan. You’ll have the money you need to sell it on before the interest builds. It’s a gamble, but one that can be very lucrative.

Forex Trading

Forex trading is perhaps one of the simplest forms of investing with the lowest amount of risk. When trading in Forex, you are trading in currency. You will make money by determining whether an exchange rate is going to rise or fall. The benefits of this type of investment is that anyone can do it with little knowledge or skill. You can also invest as little or as much as you like. However, compared to property flipping you won’t make as much money. Also, investing in forex isn’t as stable as putting your money into gold investment.

I hope you have found this post useful. If you invest your money correctly, you can easily make enough cash for a comfortable retirement.