Buying an investment property continues to be one of Malaysia’s favorite ways to invest. An investment property should be about building your wealth and securing your financial in the future. However, there is a common misconception that property investing always award the investors for positive returns. Well, this can be true sometimes, it can make your rich but not get rich quick.
This is depends on how effectively you manage your investment property(s), and it will determine whether the investment can helps you to become financial freedom.
In order to build a strong asset base and reach your financial goals, it is extremely important to buy the right properties which have more potential in the market. Here are 5 tips for buying the right investment property.
➊ Buy property at below its market value
This is the main key to buy a property. Regardless of what investment strategy that you use (buy-to-let or flipping), you have to look for the well-condition property at below its market value. Sometimes, you may think this is difficult to do so, but you can still buy a bad-condition property at below its market value. For the terms of “bad”, it is not compulsory to putting a lot of money into renovation/ remodeling. And thus you’ll need to hire a property inspector to inspect that property before decide to make a deal. And estimate how much it going to costs on the renovation/ remodeling work, if exceed your budget, it’s better to go away and look for other potential properties.
Remember, buy property at below its market value is first thing, and renovation/ remodeling cost is second thing you need to be considered.
➋ Buy property that appeal to long-term buyers
The term of “long-term” buyers is buyer who want to buy property for their own stay. By knowing how to target this section of the market, you can ensure that your property or its area are in high demand.
➌ Buy property with unique features
You may consider to look for the property that have a unique features, facilities, concept or anything that is not commonly found in other properties. For example, a house have an existing Barbecue area for partying, there is a swimming pool at the rooftop or other special features. With these features, you can gain more profits from selling out the property.
➍ Buy property that have potential to increase in value
When you choose to property flipping, ensure that the property you’re going to buy have a best potential to increase in value after refurbished. Also, the buyer market that you’re targeting should be long-term too. You can buy an older property or less ideal property to start with, and then renovate it (make sure that the renovation project can bring you a better return and buyer willing to pay for it), but not overdo (as you can make it more expensive) and put it on sale once the project is completed. (Click here to learn more property flipping: 6 Tips To Flip A House For Good Profit)
➎ Buy property with a long history of capital growth
Take your time to do the research of the demographics in an area and focus on the area community have the potential for an increasing disposable income or the neighborhood is becoming gentrified. For example, Penang, Georgetown. With a long history in this area, the value of the properties in this area is increasing and its value will only increase and never decrease.
Last but definitely not least, buying the right property to invest in is the key to lead yourself to success. If you invest in the wrong property at the first place, you are doomed. Study the demographic of the area and market movement is also important. Always do your due diligence before putting your hard earned money into that property.
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