10 Tips for Successful Real Estate Property Investment Part 2
To find out the first 5 tips for Successful Real Estate Property Investment click here:
6) Know the entry costs, research fees, charges and all expenses you will incur when you buy your property. Know how much you will have to incur and factor this amount into your budget to avoid any nasty surprises and to ensure your investment can become profitable.
7) Capital growth potential and what factors point to the potential profitability of your real estate property investment? If you’re looking at an emerging market, which economic or social indicators exist to suggest that property prices will increase? Are there any indications to suggest that demand for rental accommodation will remain strong, increase or even decline? Think about what you want to achieve from your investment and then research and find out whether your expectations are realistic.
8) Exit costs and if you will incur substantial capital gains taxation liability if you sell your property investment for profit, will that render the investment profitless?
9) Profit margins and what levels of capital growth can you realistically gain on your property investment or how much rental income can you generate? Work out these facts and then work backwards towards your initial budget to work out your potential profit margins. At all times you have to keep the bigger picture in mind to ensure that your real estate investment has good potential for profit.
10) Think long term, unless you’re buying property off plan and intending to flip it for resale and profit before completion you should view real estate investment as a long term investment. Real estate is a slow to liquidate asset, cash tied up in property is not simple to free up. Take a long term approach to your property portfolio and give your assets time to increase in value before cashing them in for profit.