It is never easy to make investments. I have to literally fight with myself in my mind before I invest any amount of money on shoes, clothes, mutual funds, stock market or anything else. But what is extremely easy even for an Investo-Phobic like me is investing in Real Estate. Indeed these investments are generally low on liquidity gain but relatively favourable in terms of the risk/reward profile when compared to other investments.
- Location is Primary
Location of the house or property still remains the top priority for buying or investing in property. If you are looking to maximize your returns from the property you must give specific attention to factors like:
- Peaceful Conforming Areas
- Neighbourhood status
- Scenic view
All of these factors will play a part in determining the profits that you can get from this property in the future.
- Look for your Investment Time
Time or the period of investment is dependent on the duration in which the property is expected to evolve in terms of the factors mentioned in the previous point. The open land that you may expect to evolve as a residential neighbourhood may turn out to be an area surrounded by industrial noises from manufacturing units.
- Define Your Purpose
You need to first determine the motive behind your investment. You may buy or invest in real estate for various purposes like self use, or lease or for the purpose of sale (both long and short term). If you do not possess a specific purpose for investing in real estate, then you must make sure that you have done that before even taking out a single penny from the pocket.
- Real Estate can be Difficult but is less Risky
For sure there is low liquidity, and we can say this with equal surety that real estate offers high value investment, thus lacking direction or purpose may lead to undesirable results and create financial distress. This is specifically common in cases involving investment in mortgaged properties.
- Construction Companies
The face of a good construction companies adds a big value to the investment returns. They play a big role in building a reputation that will attract more investors and hence more value. Check with the previous construction projects handled by the construction company and the value these properties fetched in the market.
Make sure you have planned your expenses for the monthly maintenance costs and also check with the construction company for the outstanding dues and and tax liabilities from the past owners.