As you are probably aware, just like pretty much every other market out there, the real estate market is undergoing constant changes and evolving. It keeps popping out new trends, and what worked as early as five years ago might not be applicable anymore. This is why the worst idea is to be a real estate investor who strictly sticks to their old routines and believes that the old rules will always apply. It’s only a matter of time before such an investor is outwitted by someone much more flexible and knowledgeable about how the game works today.
So, it is safe to say that, if you want to be a successful investor in terms of real estate, you must always stay ahead with the trends and the new information that the industry is coming up with. In this article, we are going to discuss some of the best ways to invest in a property during the year that stands before us.
Think about your future market value and study the data
So, if we take into consideration the fact that the market is constantly evolving, you need to think about what your future market value is going to be. Certain interest rates are growing more than others, so you need to consider where you fit in. If you see your value dropping, you should bear with a 10% contingency in terms of strategic pricing or underquoting, in order to have a margin that will enable you to deal with the offers once you’ve actually reached them.
Now, one thing that remains crucial every year is understanding the market through all of the data that you can gather. This needs time and work if you want to get the proper results that will be worth anything to you. But, once you have done that, you will basically have the year in front of you in the palm of your hand. In order to make the right decisions, you must learn all there is to know about interest rates, costs of construction, city trends, market requirements, and so on.
One of the trends that you should consider is flipping houses. It isn’t easy, and you will be dealing with a certain amount of risk. But if you do it right, you can reap big rewards. So, does it mean to flip homes? Basically, you buy a house for a price below the market value, you refurbish it, and then sell it in order to gain profit.
What you’ll be after are bargain homes, which are the ones where you don’t have to do so much work. The best house for this is one that basically needs an aesthetic touch in order to be enticing for your buyers. What you have to be prepared for is the fact that sometimes the house will not sell fast. Or, it might even be that you won’t gain as much profit as you had hoped. These are some of the risks, so be very attentive when choosing a home in terms of location, requirements, and the price.
Purchase a rental property
If you are looking for a way to have a monthly amount of cash flow, you can choose to purchase houses and then rent them out. The right way to do this is to invest in a rental properly whose home insurance payment, mortgage payment, and property tax payment are below the rent. You can, for example, purchase a house in a location with high rents, or invest a lot of money in order to reduce the mortgage payment. Generally, when making a decision on what kind of property you want to purchase, it is a wise idea to consult a professional. If you are, for example, purchasing in Australia, you would look for advice from a Brisbane buyers agent.
There are two things that make rental property a bit of an issue. First of all, you will have to deal with renters. This is why it is going to be crucial to screen any potential tenants. Furthermore, you will have to be rigid when it comes to pricing, rent, and the like. The second issue is the fact that you will usually have to invest a large sum of money up front. This includes down payment and maintenance. Basically, it’s all about being certain that your ROI is going to be worth all the effort.
Get a contractor’s license
Furthermore, if you want to boost your profits, you can get rid of any mediators and get yourself a contractor’s license. This makes things a lot simpler, because otherwise, you have to hire a contractor who is going to get the necessary permits and manage the whole project, which can at times cost you enough that it makes your profits almost meaningless.
Also, if you are going with the idea to purchase a rental property, maintenance, enhancements, and renovation are going to be a lot more expensive than if you owned a license and did it all by yourself.
If real estate sounds like kind of investment you want to make, then you need to be knowledgeable about all the trends that are going to matter this year, and have all the necessary information in hand so that you can do a proper job.
It is crucial that you determine your future market value and study all the data that you can get your hands on. Then, there is a variety of choices that you can make. You can flip houses, purchase a rental property, and so on. According to what kind of business you are going to be doing, it could really benefit you to get a contractor’s license.
Audrey Taylor was born in San Francisco, and moved to Adelaide at the age of five. Marketer researcher and social media manager on hold, full – time mommy of a cheerful two-year-old. Graduated from Queensford college, worked in a couple of marketing agencies across Australia, eager to learn more about business and share her experiences. Traveled across Europe. Her hobbies include: home decor, fashion, travel, music, old movies.