Investing in real estate can be an intimidating prospect. But it also promises large potential returns. So get past your nagging questions, and learn whether real estate investing is for you. Read on for condo investment tips that will help you make the right decisions.
How would I finance my real estate investment?
There are several ways to finance your first real estate investment. You can approach accredited banks and ask for their requirements and terms for mortgage loans. You may also approach the property developer and ask if there are any in-house loans being offered. And of course, there’s Pag-IBIG fund you can turn to. Do the necessary research so you can check which option offers the cheapest terms. You should also make sure you qualify for the loan option you choose. Don’t hesitate to ask questions. Figuring out the best financing option for you is an important part of your condo investment strategy. The decision you make at this point can mean tens of thousands of savings in the long run.
To further lessen your worries on how to finance your real estate investment, you can also start challenging yourself to save money for your first condo. Sometimes, funding your dream investment may include a bit of improvement to your current lifestyle.
Should I get a real estate license?
A real estate license is actually the authorization of the government giving agents and brokers the legal ability to represent a buyer or home seller in the process of buying or selling a real estate property.
Having a real estate license comes with benefits. You get better access to investment options if you are a licensed agent. You also have larger potential profits, because you won’t have to give other brokers their cut. Investing in real estate without a license, on the other hand, offers the opportunity to work with agents of varying expertise. This opens the door for investing in several niches. Moreover, earning a license is both time-consuming and expensive. Whether you should get a license or not depends on the level of commitment you’d like to take in terms of real estate investing. In any case, you can invest in a real estate property without getting your own license.
How do I determine whether a property is a good investment?
To properly determine a property’s value as an investment, learn to calculate its After Repair Value (ARV). Look beyond just the property’s selling price, and inspect its condition and estimate the cost of repairs. This is important, so you can analyze whether the investment is still worth it after you’ve factored in the cost of repairs. Calculating ARV can be challenging even for seasoned investors. The best route for newbies is to go for a newly built property or one that was built and maintained by a reputable developer. Newly-released condo properties are always a convenient option. You may also go for pre-selling condo units, which are often offered at lower prices.
What is the best location for my real estate property?
Don’t let the price dictate your choice of location. Sometimes a property is offered at lower prices because it is in a bad neighborhood. For first-time investors, it’s best to choose the usual popular locations. If you plan to live in the property, choose a development that is located near your place of work and other places you frequent. If you plan to rent it out, study nearby attractions and see if you can have an endless stream of tenants. This may be your most important consideration yet, so make sure you do your homework.
What do I need to consider as a first-time homebuyer?
Beyond just the financing options and the type of property, there are considerations that first-time homebuyers may not be aware of. For one, you must be aware of the reputation of the property’s developer. Are they reliable? Do they have a good track record? Dealing with a reputable developer will spare you a lot of headache in the future. The same thing goes for your broker and the previous owner of the property (if you are buying it from someone else). A trustworthy broker will readily divulge all pertinent information and will ensure you get your money’s worth. In addition, the former owner of the property will offer a glimpse on whether the property is a good catch. Learn more about how long they’ve owned the property and ask for the reason why they are selling it.
What type of property should I choose?
If you are new to real estate investing, you will have to go for properties that are simpler and cheaper. This is the reason why many real estate investors carve out their career in condo investment. Condominium units are easier to acquire and to sell. They are also easier to maintain and rent out if you’d like to have a rental business. If you plan to simply live in the property, a condo could mean more savings in terms of less transportation costs and more time saved away from the heavy traffic.
Do I have what it takes to be a landlord?
If you plan to have a rental business, the job goes beyond just investing in real estate. You need to be a good landlord as well. As a landlord, you will have to remember to treat your rental property as you would any other type of business. This means that you must be ready to provide excellent “customer service” to your tenants. You should also properly screen your tenants so you won’t have to deal with possible stress in the future. Contracts should also be drafted, and should properly cover all grounds.
What type of unit works best for me?
For starters, you must consider the right unit size for you. Needless to say, the size of the unit you choose should match the number of occupants. And of course, your choice will have to match your budget. You should also check whether the condominium has all the amenities you seek, and that you are getting your money’s worth. You should not be paying as much association fees as any other property that offers better amenities. Beyond just the amenities, you must check the overall environment of the condominium. Is the property management doing their job well? You will know this by checking the property’s cleanliness, general population, noise levels, waste segregation, and the like. Feel free to be meticulous about such things.
Should I find partners or go on my own?
Real estate investors choose to either work on their own or with partners. Partnerships offer several advantages, especially for first-time investors. These include additional financing, shared investment risks, distributed workload, and others. It is not without its disadvantages though. You will have to deal with profit distribution, interacting with different personalities, facing the risk of being cheated on, and other such compromises. Weigh your options and see which one works best for your own needs and preferences.
Should I enlist the service of a professional property management?
As you may now realize, real estate investing does not end in buying the property. Once you’ve bought a property, you will have to manage it. You will also have to do the marketing to win over tenants, not to mention the maintenance work and customer service that go with it. Plus, you will have to deal with legal issues and taxes. Prime developments often have a reliable property management to help the homeowners. DMCI Homes, for one, has its DMCI Homes Leasing Services (DHLS) that is committed to providing proactive solutions for investors and homeowners who want to rent out their units.
Figure out how to make money renting condos and other such real estate investment strategies. Once you’ve got this figured out to a T, you can spend the rest of your life earning much for less work. Begin your condo investment journey now!