3 Questions You Should Answer Before Buying A Property
Investing in real estate could be a herculean task if you have little knowledge about your local real estate industry.
Several investors have lost their resources owing to bad real investments.
Also see: 6 common mistakes first time investors make in real estate
In today’s post, we highlight 3 key questions that you should answer before you proceed to invest in your next property.
These questions will help to guide your choice of property while ensuring that you make a profitable investment.
1. Why am I buying a House?
Your reason for wanting to acquire a property plays a vital role in your property search, as it informs the features you look out for.
Do you want to acquire a new family home or are you simply searching for an investment property?
Searching for a family home means that you will pay more attention to the size of the spaces, the ambience, the neighborhood, its proximity to vital facilities and so on.
An investor who is focused on ROI may prioritize the profitability of a property over other details.
Being guided by your intent when acquiring a property is a great way to ensure that you do not commit errors, bearing in mind that investment mistakes in real estate can be costly.
2. What is my total budget?
Without a clear understanding of your finances and how much you are willing to invest in a property, it could be a waste of time to start looking at houses for sale.
Having a budget gives you the opportunity to accommodate additional costs – especially in situations where there are additional costs to cover other than the sale cost.
These costs could include renovation costs, etc.
A clear understanding of your budget and finances also helps you avoid being stuck with an abandoned project. This is especially important if you are making your investment in installments.
Your budget also serves as a compass in piloting your property search.
3. What is the right neighborhood?
After identifying your intent for wanting to acquire a property, the next step is to identify the right neighborhood for you.
You can always renovate a house and change things you don’t like, but the neighborhood is there to stay.
For a family home, you may want to choose a neighborhood that is serene and away from the bustling of the city.
On the other hand, an investor may be concerned about the agents of appreciation in a neighborhood such as: the influx of new residents to the neighborhood, new infrastructure, etc.
Investments in real estate remain the most profitable kind of investment on earth. However, diving into the industry without adequate knowledge or guidance could lead to bad investments.
Interestingly, our investment advisors are willing to walk you through the process to a profitable investment.