How To Become A Successful Real Estate Investor

Investing in real estate is one of the most secure paths to growing wealth. When you invest in property, you can start a business, develop the property to increase its value, or even wait until the market value rises. Opportunities are endless when you are a real estate investor, however, you can also make mistakes when you don’t do your research and keep up with real estate trends. So how can you avoid these mistakes and follow the right path to becoming a successful real estate investor?

Follow these tips to become a successful real estate investor:

1. Create a Financial Analysis

Like any other investments, you need to have a plan. Real estate investors, even those who aren’t first-time investors, analyze their finances and set short-term and long-term goals. This will help them come up with a strategy on how they will achieve the return of their investment. Investing in real estate entails a lot of costs that need to be considered; hence, keeping track of your finances is a must. 

A financial analysis will also help you identify how you will finance your property and which property you can afford to buy. With a plan, you’ll be able to identify the next steps and narrow down your options in choosing an investment property.

western australia map

2. Choose a Good Investment Location

When it comes to real estate investment, location plays a big role in whether or not your investment will become successful. Make sure to choose a property in a profitable location. Once you’ve targeted a location, research about its current housing market trends like population growth, unemployment rate, and mortgage rates. Also take note of property prices, rental rates, price-to-rent ratio, tenant occupancy, and vacancy rates. Are there emerging establishments and amenities within the community? Determine how it will affect the value of your property.

3. Understand the Market

Understanding the real estate market will help you evaluate the real value of property in an area and identify where the demand is strongest. For short, learn to put your money where it will earn you the most in the shortest amount of time. If there is a high demand for studio apartment rentals, buy an apartment. If there is a high demand for family-friendly homes, invest in family-friendly homes.

Once you grasp the concepts of the real estate market, you’ll surely be one step closer to becoming a successful real estate investor.

learn to manage risks

4. Learn to Manage your Risks

When you know how to manage risks, you’ll avoid losing money fast. Managing risks when buying a property means analyzing the cost versus the return on investment rate of the property. Don’t just buy a property because it’s cheap, there might be hidden structural damages that could cost you thousands of dollars in repair.

Managing risks also mean avoiding going deeply into debt in terms of what you can afford. Be careful with your lender’s interest rate as it could eat into your profit margin. Make sure that you have a cash reserve in case you need to spend extra money on repairs, improvements, and other expenses. Don’t buy a property that is outside of your budget to avoid needing to suddenly sell it or foreclose it.

5. Maximize Real Estate Investment Potential

Aside from the current potential of your investment property, look for other ways on how to upgrade it and maximize its investment potential. If it’s a rental property, add more amenities or security features. It will also attract more tenants. You could use some space in your rental property to set up your own business – a small convenience store or a cafeteria. You can also offer services like trash pick up to your tenants and charge a minimal fee per month. Rent out a corner to a bank to install an ATM.

There are a lot of ways on how you can maximize your property’s investment potential aside from its current investment value. You just have to think it through.

an experienced buyer's agent

6. Hire an Experienced Buyer’s Agent

An experienced buyer’s agent will be able to help you in identifying properties with great investment potential. They have an extensive network and knowledge which they can use to find you amazing off-market property deals, negotiate the contract price so you can save thousands of dollars, and can check and handle all the paperwork for you. If you are looking for convenience and quality, hiring an experienced buyer’s agent will definitely give you value for your money and an investment that you won’t regret.

Becoming a real estate investor is not the same as buying your own home. In real estate investment, you’re putting out money with the expectation of getting more in return. The experienced buyer’s agents at Buying Perth Real Estate can help you find the best investment property. 

Let’s talk about how you can start your real estate investment! Give us a call at 08 6215 0200 or send an email to clive@buyingperthrealestate.com.

Why You Should Invest In Developing Areas

Have you been thinking about why you should invest in developing areas? When buying a home, one of the most important things that you should consider is the location of the property. In fact, location is key when it comes to investing in real estate. A property’s features and condition can also be changed and improved, but you can’t change its location.

While most people would prefer to live in the city centre, properties in this area are usually limited and more expensive. Consider buying a property in places where there are plans for future development. Upcoming city centres are cheaper, but with developments in place, their prices are sure to increase in a few years. When you invest in developing areas, you are definitely making the right long-term choice.

Here are some reasons why you should invest in developing areas:

a lot of available land and space

Land availability

Unlike developed areas, locations that are still under development have more lands that are still available as a big portion of the area is yet to be developed. With this, you will be able to have more options and have the chance to choose the best lot available.

However, though this would seem to be an advantage for a buyer, you should still do your research about the location. If a big portion of land is still available for quite a while, it can be a sign of low demand. If it stays this way for a longer period of time, it can affect the future value of your home. 

It is best to check with your buyer’s agents as they are more knowledgeable and they have the connections and means to gather necessary information about your target location.

invest in developing areas to grow money

You can invest at a lower price point

Since the demand for property is lower for developing areas, you can buy them at a lower rate compared to those in highly developed areas. There tend to be fewer buyers and more supply since the value of this area has not been recognized yet. Once the area starts to develop, however, the demand will push the prices of the properties up.

a building being constructed

Upcoming infrastructure

Another advantage of investing in developing areas is the upcoming infrastructure. Once the area has developed essential establishments within the community, the value of your property will increase. The nearby infrastructure is crucial to the potential growth of your investment; hence, you should ensure that the area you are planning to invest in has a reliable and financial developer and a progressive local government authority,  who will take care of the infrastructure development. If the development is delayed, it can affect the timeline of your investment growth.

Developing areas are great investments as prices tend to appreciate faster because of surging demand. However, when buying a property you must also consider accessibility, appearance of the property, and amenities of the neighbourhood.

Consult with an experienced buyer’s agent before making any decision. Get well-researched market insights, exclusive listings, and more when you hire a buyer’s agent at Buying Perth Real Estate.

How To Build Wealth Through Property Investment

Have you ever realized that no matter how good your salary is, it doesn’t seem to be enough for you to achieve financial security? Achieving financial security and growing wealth through an average salary can be a big challenge, especially if you have many bills to pay. However, you don’t have to limit yourself with your salary alone because you can build wealth by having a property investment.

Having property investments is one of the most secure and safest ways to build wealth especially if you have long-term goals. Here are some reasons why you should consider investing in properties:

Why Invest in Properties

Property investment is safer and more stable than investing in a business or in any share. Real estate is bound to rise long-term because the supply of land is limited and will always be lower than the demand for it. Property investment is safe enough that governments and banks have created programs for people to be able to buy properties of their own. Everyone needs to live in a house either by buying or renting.

You might think that the only way to earn from your property is by selling it after several years, however, you can actually start earning once you buy a property. 

Ways to Build Wealth Through Property Investment

To give you an idea, here are some ways on how to build wealth through property:

Capital Growth

Once you’ve purchased a property, you wouldn’t immediately gain profit from it. You might actually spend money at first to pay off your mortgage, depending on your approved loan. On a positive note, you can eventually gain profit from your property because of its increasing value. Over time, real estate value increases; hence, your property wealth increases as well. This is similar to the idea of buying at a low price and selling for a higher price.

Aside from the increase of real estate value over time, another way to create capital growth is by doing renovations and upgrades to increase the value of your property. By doing this, you wouldn’t need to wait for a longer time for your property value to grow as you get to do something to increase its value and don’t need to rely on property appreciation.

Buying Direct Property

One of the best ways to invest in property is by buying a direct property. A direct property means owning a residential property 100% under your name. When you have control over your property, you can do what you think can get you the best return on your investment.

You can choose to live on the property and let its value grow. You can choose to get tenants or furnish it to have it rented as an Airbnb. Getting a mortgage is another option if you need to get cash immediately. 

It’s also important that you buy a good property that can last for years. Buying then selling properties to upgrade constantly can be costly in terms of fees and taxes. Experienced buyer’s agents can help you get a good quality home that would fit your lifestyle and needs.

Invest in Properties to Achieve Financial Security

Having financial security is important because it lets you live your life freely. You become at peace by knowing that you are secured and you have enough finances for your needs, emergencies, recreation, or for other purposes. 

With its fast recovery from the pandemic and its developing economy, Perth is one of the best places to build property wealth. To learn more about building wealth through Perth real estate, the buyer’s agents of Buying Perth Real Estate are more than willing to discuss with you. Call us at 08 6215 0200 or send an email to clive@buyingperthrealestate.com 

Why Real Estate Is A Great Investment

More and more people are starting to explore different ways to build their wealth. Aside from having multiple income streams, having an investment is a faster way to build wealth. There are various options when it comes to investing, but having a real estate investment still remains one of the best investments that a person could make.

Here are some reasons on why real estate is a great investment:

The real estate market is less volatile.

Unlike investing in high-risk and high-return markets such as stocks and cryptocurrency, the real estate market is less volatile and less vulnerable to sudden price fluctuations. Of course, these markets have their own advantages such as accessibility and liquidity, but if you are looking for a long-term investment that you don’t need to monitor on a regular basis, real estate might be a better option for you.

real estate prices tend to go up

Its value always increases over time.

Although prices tend to fluctuate every now and then, real estate price values always increase over time. By putting time in the market, you will get a higher value for your investment than selling it sooner. 

It has a high tangible asset value.

Unlike investing in the stock market where your money is used to buy shares from a company, you can physically use your real estate investment. You can build on it, renovate it, live in it, or rent it out. By making improvements and maintaining it, you can increase your real estate property’s value. You can even earn more from it by having it rented.

real estate investment

It can increase your cash flow.

Investing in a property is a great way to increase your cash flow. Once you’ve already finished paying off your mortgage and operating expenses, you can gain profit through rental. Rental properties provide a regular, steady, and passive income. This makes it a great way to generate additional income and grow your money. 

Another way to make profit in real estate is by buying it at a low price and selling it at a higher price. Aside from the increasing value of real estate over time, you can gain more profit by building equity.

It can diversify your portfolio.

If you aren’t new with investments, you surely know about the importance of portfolio diversification. Diversifying your portfolio will help you spread out possible risks. Since real estate is a safe tangible asset, it mitigates the risk in your portfolio. Given this, it can lower your portfolio volatility and eventually provide a higher return per unit of risk.

It comes with various tax benefits.

Aside from gaining profits from real estate investments, you get to save more money as property investment provides numerous tax breaks and deductions. To simply put it, you can get tax deductions for the cost of owning, operating, and managing a property. Just ensure to record all expenses including maintenance, utilities, rental repairs, and insurance.

Throughout the course of owning a property, you will benefit from the various expenses as these deductions from your revenue will lower your taxed income.

Start Investing in Real Estate

Investing in real estate is a big decision. It’s definitely something that you need to plan and research before closing any deal. Make sure that you are ready with your deposit and have a stable stream of income. Look for developing neighbourhoods in your area. Lastly, manage your risks and calculate your possible profits.

If you’re not sure if you’re ready to invest in a property, get a free consultation from us and we’ll gladly help you in weighing the decision.