|
Author: Rhiannon Williamson Article source: http://www.articlecity.com/. Used with author's permission.
Just because real estate prices seem to have hit a temporary ceiling in many countries around the world, that doesn't mean that profits from property investments are hard to come by.
Even during a real estate market slowdown, stagnation or depression profits can be made locally and overseas. This article shows you the top ten tips that real estate investors apply to their property portfolio building strategy to ensure success from their investments.
1) Research the curve - the concept of a property market cycle existing is not myth it's a fact and is generally accepted to be based on a price-income relationship. Check the recent historical price data for properties in the area of the country you're considering purchasing in and try to determine the overall feel in the market for prices currently. Are prices rising, are prices falling or have they reached a peak. You need to know where the curve of the property market cycle is at in your preferred investment area.
2) Get ahead of the curve - as a basic rule of thumb, professional real estate property investors seek to buy ahead of the curve. If a market is rising they will try and target up and coming areas, areas that are close to locations that have peaked, areas close to locations experiencing redevelopment or investment. These areas will most likely become 'the next big thing' and those who by in before the trend will stand to make the most gains. As a market is stagnating or falling many successful investors target areas that enjoyed the best levels of growth, yields and profits very early on in the previous cycle because these areas will most likely be the first areas to become profitable as the cycle begins turning towards positive once more.
3) Know your market - who are you buying property for? Are you buying to let to young executives, purchasing for renovation to resell to a family market or purchasing jet to let real estate for short term rental to holiday makers? Think about your market before you make a purchase. Know what they look for in a property and ensure that is what you are going to be offering them
4) Think further afield - there are emerging real estate property markets around the world where countries' economies are going from strength to strength, where a growing tourism sector is pushing up demand or where constitutional legislation has been or is about to be changed to allow for foreign freehold ownership of property for example. Look further afield than your own back yard for your next property investment and diversify that real estate portfolio for maximum success.
5) Purchase price - set yourself a budget that will realistically allow you to purchase what you're looking for and profit from that purchase either through capital gains or rental yield.
6) Entry costs - research fees, charges and all expenses you will incur when you buy your property - they differ from country to country and sometimes even from state to state. In Turkey for example you should add on an additional 5% of the purchase price for all fees, in Spain you will need to factor in an average of 10% and in Germany fees and charges can be in excess of 20%. Know how much you will have to incur and factor this amount into your budget to avoid any nasty surprises and to ensure your investment can become profitable.
7) Capital growth potential - what factors point to the potential profitability of your real estate property investment? If you're looking overseas at an emerging market, which economic or social indicators exist to suggest that property prices will increase? If you're buying to let out are there any indications to suggest that demand for rental accommodation will remain strong, increase or even decline? Think about what you want to achieve from your investment and then research and find out whether your expectations are realistic.
8) Exit costs - if you will incur substantial capital gains taxation liability if you sell your property investment for profit, will that render the investment profitless? In Spain a foreign buyer can incur up to 35% capital gains tax, in Turkey on the other hand property sales are capital gains tax free if the underlying real estate has been owned for four or more years.
9) Profit margins - what levels of capital growth can you realistically gain on your property investment or how much rental income can you generate? Work out these facts and then work backwards towards your initial budget to work out your potential profit margins. At all times you have to keep the bigger picture in mind to ensure that your real estate investment has good potential for profit.
10) Think long term - unless you're buying property off plan and intending to flip it for resale and profit before completion you should view real estate investment as a long term investment. Real estate is a slow to liquidate asset, cash tied up in property is not simple to free up. Take a long term approach to your property portfolio and give your assets time to increase in value before cashing them in for profit. Rhiannon Williamson is a freelance writer whose articles about property investing and emerging real estate markets have appeared in publications around the world. She is currently working on a brand new property investment resource http://www.amberlamb.com/
30th Birthday Gift Ideas
Choosing a birthday gift for a friend about to turn thirty years old can be a challenging task. You want to honor the special day with a unique gift, but not ne...
Three Easy Lessons to Take Your Online Marketing to the Next Level
I just spent the last week in two very different, but parallel universes. After helping researchers in a federal government agency work on getting their science...
Breast Feeding Basics For Your Newborn Baby
This article dispels the common myth that bottle milk and breast milk are the same. Discover which one is better for your baby and why this choice can help main...
These Are the Hackers of Our Life
Jokes aside. We are living in the 20th century with computers and cell phones and high tech ways of communicating BUT with all this brilliant technology comes t...
My Dog Died !
The bond between person and pet is like no other and the way we say goodbye is like no other.
Using Credit Cards Wisely
Using credit wisely is a good habit that, with only a little financial education, you can learn quickly.
Changing Your Cooking Habits
Having more body weight than is considered healthy or allowed for one's age is risky for your health. If you want to lose weight you must swap your bad eating a...
Angel Messages for Humanity ™- Message 1
In the interest of mankind the Angels are delivering messages full of hope, love and joy for a better today and a better tomorrow. I have agreed to be this chan...
Using Blind Carbon Copy (BCC) For Email Privacy
Many people sending email to multiple addressees reveal the email addresses of everyone to whom they send their messages. This is increasingly unacceptable etiq...
Value Proposition Writing - Brand Identity Guru
Your Value Proposition, or as I usually call it, your Core Marketing Message, is still misunderstood by most professionals. It's not just a tagline, sound bite ...
Light Imitating Art - How to Use Lighting as a Decorative Feature
Lighting is often thought of as a necessity, which it is, but not often as part of the decor. This is more the case in residential settings. For years architect...
Your Cover Letter MUST Ask This Question
Imagine receiving a letter from a salesman who wants to sell you an exciting new widget. The letter focuses on all the reasons why this is such a great item. ...
Marketing Tourism Online, Part One: The Basics
This is part one of an article series which will introduce some basic strategies, considerations, elements, and techniques for marketing tourism products online...
Selling Houses: The Basics of Design Psychology
Great article for real estate sites and ezines. Here are a few Design Psychology tips you can use to maximize your sales profits without having to spend a great...
Five Simple Ways to Reward Yourself and Lose Weight
We eat not only for nourishment but for emotional reasons. Five steps to help with emotional eating.
Types of Credit Cards
There are a whole variety of different types of credit cards available which can make choosing the right one a very confusing experience.
To Lead or Not to Lead?
Working with Leads or Opt-In Clients can be very confusing at times, Some people will tell you that Leads are not a good source of advertising while others will...
What is Link Trading and How Do You Trade?
Link trading is the task of getting links to your site on other sites by trading.. umm.. links. This is done to get more traffic to you web site. Link trading c...
Getting Started is the Toughest Part of the Job
If getting started has you stunned with fear, take a deep breath and take one small action. Do something, anything. It doesn't matter what you do as long as you...
Diet Fads Come And Go
Cursed by dieters everywhere, and loved by children around the world, sugar is one those substances we 'love to hate' and 'hate to love'! It can make bland food...
Law and Order of the Spiritual Kind
There is no such thing as a coincidence. Albert Einstein reasoned that, "God simply does not play dice." While we may not fully understand the reasons behind ce...
Overcoming The Fear Of Money
Many people, it seems, have a fear of money. Does the thought of having a lot of money make you uncomfortable? Cause you anxiety? If so, it may be that you a...
6 Great Freebie Resources for Parents of Twins & Multiple Births
A sure way to double the joys of parenthood is to give birth to twins! You'll have twice the smiles, goos & coos, giggles, and firsts (first words, first steps,...
The Top 5 Things You Must Know Before Applying for a Mortgage
Understand your options before approaching a mortgage lender.
|
Print this page