The 2018 Guide for Real Estate Investors
Posted September 20, 2018
Many a first time investor commonly start with the thought of where to place their money when it comes to raising their capital. Financial experts and advisors often repeat the saying, “don’t place your eggs in one basket.” This is habitually true for the seasoned investor. However, despite the rationales that anyone can read on financial investments, first-time investors have no idea where and how to begin. Equities, bonds and mutual funds, among others, are some of the financial instruments that are well known, but to give clarity it is recommended to know how to strategically take advantage of each of them. For this intention, we’ll be exploring real estate as a financial instrument and how we can help course through the process.
Real estate is a type of financial instrument that is recognized as a long-term profitable investment proposition. Its value is based on the price of land, which soars with its ever-increasing cost. Owning real estate assets is costly, which means the level of risk should always be taken into account. Our task is to give temerity to the first time investor by comprehending what was once a foreign instrument.
Part of our services is to help the investor decide which type of real estate investment is best suitable. In order to take advantage of the booming opportunities that real estate investing has to offer, it is important to consider the following options: pre-selling and ready for occupancy.
Preselling is one basic form of real estate derivative where the investor acquires a property (mainly condominiums, townhouses or lots) via a financing scheme while it is during its development stage. This derivative allows real estate developers to finance the construction and offer investors the opportunity to acquire the property at a much cheaper value.
This is a good form of investment whether an investor is looking for long-term or immediate returns. Pre-selling developments are normally completed on a 1 to 5 year basis.
Advantages: strong capital appreciation, easy payment terms (sometimes no down payment), a wide variety of units and views, availability in major cities, brief ROI by turnover date
Points to consider: unforeseen delays
View our pre-selling options here.
Ready for Occupancy
Investing in Ready for Occupancy (RFO) units are properties that can be ready for use. This form of investment is good because of its versatility upon acquisition. With RFO properties, an investor has the faculty to use his assets for the following: to have it leased, to resell or to redevelop. RFOs are not only limited to condominium/residential units as these are also involved in industries from the commercial, industrial and tourism branches of real estate.
Advantages: high return on investment, strong appreciation, strategic location, versatility, potential rental income
Points to consider: full payment is usually required but bank financing is readily available
View our ready for occupancy options here.
Leasing is another real estate service we provide. Leasing a property, whether office, residential or industrial, provides the investor the opportunity to rent in a prime location with a good reputation. Businesses and office spaces are dependent on location with high traffic thus this option makes it more affordable.
With this type of real estate, investors can respond to other opportunities on the market.
Advantages: prime locations, flexible lease period, the variety of options in different industries
Points to consider: annual rent increases, variable costs
With these types of options in mind, the investor can be more equipped with the confidence to navigate which direction his funds will go as far as property investment is concerned.
Are you looking for a particular property? Send us your requirements and we’ll help you get started with your first investment.