More and more people are turning their attention toward property investment these past few years. The real question would be “Why?”
Not surprising, real estate is considered as a great investment for a great number of reasons. A high rate of returns and great tax advantages – these are just some of those reasons.
Financial security is probably one of the huge determining factors as to why an individual would invest or not invest in the real estate market. First-time investors would initially feel fear as to losing a lot of money by investing in one thing – real estate.
However, this is actually one of the many misconceptions about property investment. When you invest in the real estate market, you are actually putting your eggs in several baskets. This is an example of a high-risk strategy that most people will not want to be a part of.
Nonetheless, this article will provide you several low-risk strategies that may be of use to you.
Related: Different Types of Real Estate Investments
Mortgage Interest Rates Are Low – Again!
A few years back, the mortgage rates were extremely low resulting in a frenzy where a lot of people were investing in properties and buying houses.
Some of these investors ended up with a lot of money; however, they were too greedy and borrowed against their earnings. This was actually one of the many reasons why the real estate market took a huge downturn.
But, property investment is slowly on the rise. You need to take this opportunity and invest in real estate.
Property Investment is Powerful and Stable
Stability is a major determining factor when investing in something. As explained, the last economic years were tough on the real estate market. This has taught investors to look for assets that are not only powerful but also stable.
When we say “powerful,” we are pertaining to investments that act as a hedge against the rise of market prices. It should have the capacity to grow at an amazing rate. Stability, on the other hand, pertains to the steady growth in value of a particular investment.
Real estate is a great example of a powerful and stable investment. Despite the almost collapse of the real estate market a few years back, property investment never really went away. In addition, it does not have any major fluctuations in value.
Property Investments Provide Better Returns than the Stock Market
This is an important point because by investing in real estate, the only risk of loss you have is minimized only by the amount of time you hold on to a property. If the market improves, your property investment improves.
The risk never changes whereas the stock market presents several factors and risks that are beyond your control. A property is a tangible asset that you can easily leverage to capitalize on a number of ways.
High Volume on Recent Foreclosures
There are several former homeowners that have been displaced due to foreclosure. Foreclosure happens for many different reasons, some of which include – losing a job and the ability to make ends meet, piling medical bills due to a health crisis, and others incur the mistake of buying too many houses.
Although, when a foreclosure happens, the market is reopened for more investments. This is a great way for investors to purchase rental properties without having the burden of paying any mortgage.
Property Investment is a Low-Risk Investment
For those investors who are not risk-takers, property investment can be a great starting point. Investing in real estate will not expose you to the market’s fluctuations and volatility.
Of course, there will always be risk involved in any form of investment; however, with property investment, you can have a higher chance of getting a return and a lower chance of incurring a loss.
In addition, the risks involved in real estate can easily be managed and mitigated. There are a lot of tried-and-tested strategies that can be helpful for first-time property investors. Buy-to-let property investments are the least susceptible to any fickle investor sentiment.
Property Values Will Increase Over Time
One of the major reasons why people are starting to invest more in real estate is that property values will always increase over time. This has already been proven in history that the longer you hold onto a real estate, the more money you will earn.
Actually, the housing market has always recovered from any past bubbles. Lucky for those who have held on to their investments as appreciation is back and prices are returning to a steady pace. As a result, investors in real estate are enjoying a windfall.
A Higher Preference for Landlords
Another reason why you should invest in the real estate market is that tenants prefer landlords as opposed to property management companies. This is because there is a sense of security that only your landlord has the key to your house. Others even feel the need to buy the house through a lease-purchase or lease with option to buy contract.
If you are focused on having a short-term investment strategy, you can easily search for properties at a low price at kenyahomes.co.ke. Hence, this is your strategy, you can opt for a lease with option arrangement or a lease-purchase agreement with your tenant.
If you decide to invest in something, always look for the same characteristics as the above-mentioned. The truth is that there will always be strong economic indicators that the real estate market will see growth and positive results.