Real Estate Investing Advice (Getting started with real estate)
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Loading... - Caroline Kimani
- 26 Jan 2023
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Real estate investment has become increasingly popular over the last two decades, especially with traditional non-real estate investment firms and individual investors due to inflation fears and market uncertainty affecting other asset classes.
Although the real estate market has plenty of opportunities, investing in real estate is a lot more complicated than investing in stocks and bonds. Investing in real estate requires a good amount of cash investment which makes it critical to take extra measures to ensure return on your investment or at least save yourself from huge losses.
There are several options for investing into property which can be Residential Apartments & Houses, Commercial Office & Retail, Industrial, Warehousing, Tourism, Specialized Properties, etc and they differ in terms of potential return, investment requirements and complexities of investment and management
It is important first to decide on what type of properties you want to invest in and that is also dependent on your vision, goals, budget and expected return. Even if you are ready to invest up to a million dollars in your first investment property, it is always a good idea to go for properties that lie in the lower- to mid-range price brackets. Since it is your first investment property, keeping your investment as low as possible will help you stay in the safe zone.
Market analysis is important when making decisions and avoid reliance on intuition and complacency due to past successes. There is a mistaken notion that supply of new developments creates their own demand. In everyday language, some market players believe if they “build it, they (buyers/renters) will come”. This attitude to real estate investment and developments can lead to costly failures such as empty shopping centers or office buildings.
It’s important to do a systematic search for evidence that there is demand for an apartment complex, office building or shopping center before resources are mobilized to develop it and as well it is important to take note of the following notes:
Research Your Location & Opportunities
Depending on the clients you are targeting, you need to do proper research before buying investment property. Make sure that the property is situated in a location that will attract the type of clients you hope to sell or rent to, that it will reach the returns you are expecting and that it will appeal to the market.
You should consider the strength of the location, the rental yields that are achievable, the level of demand and the potential for capital value growth. It’s also important to look into areas that have positive expectations for price growth and a proven record of investment success.
For example, currently, we have places like Pomona, Marlborough, Greendale, etc offering many opportunities due to their strategic transport links through Harare Drive and potential price growth through regeneration. Places like Bindura, Chinhoyi and Bulawayo with opportunities for Student Housing and Hwange, Kariba, Nyanga, Victoria Falls, etc being good locations for Tourism Investments. Read More…
