While the global property crash that happened in 2008 and 2009 may have cooled investors off somewhat, those who happened to get into the property market back then are reaping the rewards.
Just recently, figures revealed that Sydney had an increase of 89% on their waterfront properties.
For an investor, this is an enormous increase in their investment, and certainly an avenue worth exploring. For the new investor, it may not be necessary to be based in one of the big cities such as New York or Dubai to reap the rewards of the property.
These properties don’t need to be mortgage free either to start making some money if only investors knew the potential.
Do The Math
One of the most important things to consider before purchasing a property as an investment, or remodeling an existing one, is to do the math.
Unless there’s an influx of cash to improve the equity in the property immediately and benefit from that additional equity, property investment can take a bit of time.
For those considering a mortgage to purchase their investment property, they also need to consider other costs such as fees, insurances, and taxes. These should all be worked into the projection to determine whether the investment is lucrative or not.
The Potential Of Rental
A buy to let property is a great way to maximize the returns on investment, especially if it was mostly a cash purchase.
Even those that have a portion of their investment financed still have the benefit of having a tenant pay back some or all of the installment.
Eventually, as the market increases and the capital outstanding decreases, investors should have some equity on the property, which could help them finance repairs and maintenance, or perhaps even their next property. Accessing the equity in a property is a convenient and fairly inexpensive form of finance.
Investment Properties With More Than One Option
Certain properties offer a lot more than just the potential to provide a rental income to the investor.
For instance, business owners who previously rented their premises from a landlord have the opportunity to own their own property and add it to their list of assets.
Another investment option is for those who prefer short-term leases, such as vacation letting and Airbnb. Investors can also purchase their properties with the intention to renovate and sell them at a higher price, known as a property flip.
One of the most important components of good property investment is exercising care and patience. An initial investment into a property might require a cash lump sum.
However, those who have the patience to wait for the return seldom go unrewarded.