Top 5 Profitable Investment Tips for Real Estate Investors

To make a profit from a real estate project, investors need to pay attention to factors such as profit potential, legality, liquidity,..Here are Top 5 Profitable Investment Tips for Real Estate Investors.

1- Choose the right location

Location is the first factor that needs to be focused on when investors decide to pour capital into real estate.  Location includes geographical location and all surrounding factors such as population, environment... The more favorable the location, the higher the value and liquidity of the real estate.  With a variety of types, each real estate segment will have its own suitable locations and terrain.

For example, if investors want to develop resort real estate, they must choose locations near tourist areas with many tourists;  integrated utilities to serve resort needs.  If you choose a location far from tourist attractions, near an industrial park, your project is not feasible.

2- Get information about legal status and developer’s reliability 

The progress of completing legal procedures of a real estate project is a factor that directly affects the liquidity time and profit level of investors.  So before pouring money into any project, real estate investors need to carefully check the legality of that project.

At the same time, it is necessary to find out information about the developer.  You should observe the current status of the projects they have built before to understand their construction capacity and reputation.  This will also help real estate investors predict the project progress in the future.

3- Consider Land value than building value

In fact, the more urbanized areas are, the faster the land prices will increase.  Areas where the selling price per square meter of real estate is at least 2 times higher than the price per square meter of construction, that is the place to invest.

For areas where the land price is only 1.5 times or higher than the construction price, it is not advisable to buy it because most of these areas, the process of attracting population is slow.

However, there are also many exceptions.  For some emerging real estate, far from the central area, the price will be quite low.  But if that real estate project is in an area where a large project is about to be built, it is also a very worthwhile place to invest.

4- Project liquidity

Liquidity is the ability to convert assets into cash;  Buy and sell easily and quickly.  A real estate project that is assessed as having no potential cannot be sold when needed, making the use of financial leverage to invest bring high risk.

Usually, there are two basic needs for liquidity: investment demand (long-term and short-term) and consumption demand.  In many cases, the investment demand of the market declines but the consumption demand increases or vice versa.  To get the desired profit, real estate investors should focus on projects that can create added value.  The best are places that can be lived, rented or sold for a short time. Value over time and liquidity will bring you many profits.

Furthermore, when improving the value of real estate when reselling, you will certainly have to spend a small amount of money to upgrade.  At this time, the cost of maintenance and repair when incurred is something to consider and estimate.  Not only that, financial leverage is a popular choice.  In the case of get a bank loan, you need to strike a balance between the interest you pay and the cash flow you can get after investing in the real estate project.

5- Pay attention to infrastructure planning and transport connections

Investors with good financial resources, long-term capital flows are recommended to invest in real estate projects in areas that are preparing to upgrade infrastructure or are in the process of connecting traffic with central areas or key economic areas. This will be an investment option that brings great returns to real estate investors.

Top 5 Profitable Investment Tips for Real Estate Investors

• Tags
• real estate
• property
• real estate investing
• property investment
• invest
• investing