" Riche Rich - Getting Rich with Real Estates! "
Real estate investment has attracted lot of people. The prospects are increasing day after day. At the same time it needs to be understood there are lot of risks in the real estate market. Real estate market has the same hype of a stock market. Therefore you should be very careful in making your investments. Some of the tips mentioned below will be helpful to you in this regard.
You should not follow the principles of investing in a stock market for a real estate market. In a stock market you generally take wild risks and invest blindly on the basis of some speculations. When you are planning to enter the real estate market you must have adequate cash at all times because the investment is very huge and moreover the returns are generally reaped in the long term. Similarly you will have to posses adequate reserves to maintain the properties for a considerable period of time. This is a prerequisite when it comes to real estate investment. You must carefully consider these factors before investing in real estate.
You must have a clear idea of how much you are going to spend and the rate of expected returns. You can approach your financial consultant for more guidance.The budget should not only reflect on the actual and anticipated revenues and outlays but also substantiate how you will meet unexpected situations because the long term financial implications are not always predictable. Even if they are predicted they won't stand true by all means.
A prime property is called so by nature of its location and marketability for e.g. in the heart of the city and is easily accessible to all and has all basic facilities nearby like transport and restaurants and above all priced at a very high rate. If you are planning to invest in a prime property you must possess adequate resources to purchase and maintain it.
The prices of prime properties in commercial areas are always on the rise. This upsurge is mainly due to the increasing economic activities and business transactions all over the globe. You need to be extremely cautious because many sellers try to woo real estate agents and buyers by making unrealistic promises and inflating the prices. Therefore unless you are confident that a prime property in a commercial locality can fetch you the income it is not advisable to invest.
Non prime properties are those which are not located in principal centers and are promising in terms of business opportunities. You need to give equal importance to non prime properties because a non prime property may become a prime property later by virtue of many factors like sudden demand, or some other resources available in the place.
Properties in residential areas also show an upward trend with regards to increase in price. However it is not profitable to invest in these because you may be able to gain profits only in the long run. Short term profits will only be marginal. Moreover the returns may not be definite as the prices of residential properties may not even increase over a period of time
What are the Means for Investing in Real Estate
It is difficult to obtain funds from banks or other financial institutions for investing in real estate. Some of the financial bodies do not even recognize real estate as an industry because the whole concept has been recently developed. Some of the fraudulent practices adopted by real estate agents and traders are also attributed to this cause.Some of the means of investing are as follows:
Down payment refers to the method of settling the whole transaction in by paying at a stroke. If you have adequate resources you may choose to go for down payment. However you must keep in mind that the purchase should not exhaust your funds completely. You will later have a difficult time in maintaining it and may even be forced to sell it at a price quoted by the buyer even if it means low profits.
If financial resources are your constraint you may choose to buy the properties by using hire purchase method. However this method has got other limitations The terms of some hire purchase agreements may be too stringent and some will even ask you to return the property if you are not able to pay the stipulated amount in time or rather impose heavy penalty in the form of heavy interests.
The real estate market is highly fluctuating like the stock market. You must have a strong knowledge of the market information before making any investments. It is better to invest in places that are less explored but where the chances of new ventures are very bright.If you decide to invest in an overcrowded place you will have to face severe competition and no amount of marketing strategies can help you to make profits like in an unexplored place.
The art of making profit is a real estate lies with this. Your investment on landed properties should be less whereas your investments on other assets like land and furniture should be high. This way when the price of the land increases you will automatically be able to make profits. When you invest more on other assets their cosmetic value will bring more consumers.
Real estate investment is becoming very popular all over the globe. There are lots of professionals in this area of investment and exclusive studies are conducted to understand the latest trends. The only caution to the aspiring investor is that he should not be carried away like what happens in a stock market. Similarly real estate is not an easy place to make money and hence investors should calculate well before investing in real estate. They can start with by collecting information on creative real estate investing, real estate residential investment, real estate investing training and commercial real estate investing. Real estate investing e-books also help them by providing certain information on real estate.
Ramalingam K
(Founder & Director - Holistic Investment Planners (P) Limited)
(21077 Points)
Replied 21 May 2014
Real Estate Investments Made Simple:
Gold and Real estate are very traditional investment avenues. Gold has evolved from its traditional investing and found its place in the modern sophisticated investment world via Gold ETFs. Similarly Real estate is also emerging as an investor friendly avenue with less hassle via PMS route or private equity route. Have you ever thought of investing in real estate will one day be as simple as investing in mutual funds? If no please read on….
https://www.holisticinvestment.in/real-estate-investment
Regards
Ramalingam K, MBA, CFP,
Director and Chief Financial Planner,
Holistic Investment Planners
“Best Performing Financial Advisor Award” Winners from CNBC TV18
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