TOP 5 TIPS FOR FIRST TIME REAL ESTATE INVESTORS
As a lifestyle business entrepreneur, (just guessing or you wouldn’t be landing on this page reading this article) you are already in business, and just thinking that investing in real estate is would be a good supplementary alternative source of income and not replace your core business. Congratulations for being on the right track!
If you have time to focus on investing in residential condominium property in the Philippines, then be prepared for a long ride to success. Here are some valuable tips and whole lot of information that can serve as guidelines before embarking on your first investment journey to success.
1) MAKE A PLAN AND BE FINANCIALLY FIT. If you intend to invest in a non-generating income real estate property, make sure that you have other income that can support mortgage payments until such time the investment property is sold. Pay attention to your savings and monthly budget as this is the foundation from which you will gradually build your investment portfolio. Have a good credit standing to obtain the leverage of using other people’s money in the future.
2) IDENTIFY YOUR TARGET MARKET. A proven and tested wealth-building vehicle is investing in Philippine residential condominium properties. Investments in residential condominium properties, particularly in rental income, can generate cash flow and distinctive tax benefits while building equity from value appreciation all the way for many years.
The growing demand for call centers in Information Technology Outsourcing and Business Process Outsourcing industry catapulted the increase in the number of expatriates who in turn contributed to the market demand for more residential condominium space rentals. Overseas Filipino Workers (OFW’s), who are obliged by the government to remit a percentage of their earnings, also influence the growing market demand in the residential property marketplace.
The aggressive Philippine medical tourism program also plays a big role in contributing to the country’s real estate property market demand growth. The accompanying family member of patients undergoing medical treatment in hospitals opt to stay in transient homes rather than pay extra dollars for luxury hotel accommodations.
3) LOCATE, PURCHASE AND MAINTAIN A GOOD RESIDENTIAL PROPERTY. Your first best real estate investment is purchasing a residential condominium to live in. Focus on residential properties that can meet the standards of your future buyers or clientele. Identify properties in the path of progress worthy of your time for serious consideration to avoid falling into the analysis paralysis trap. Choose from a wide range of options before narrowing down your list based on criteria you have set in identifying your target market. Do not postpone buying your first investment property by waiting a better deal as you could eventually loose great deal. Decide on a deal that meets your end goal rather than wait for some other deal that may never materialize.
4) BE REALISTIC AND DO A THOROUGH FINANCIAL ANALYSIS. Look into different payment scheme alternatives that make the most financial sense. You must never end up buying real estate property at a higher price than what your analysis says. Educate yourself about basic finance figures such cash flow, net income, debit financing, appreciation, taxes equity accrual, and return of investment to determine if the real estate property you are buying fits your financial goals.
5) BUILD YOUR NETWORK. Announce your new status as a real estate investor and create your presence in social media. Set out to look for your second investment property and keep the ball rolling. GOOD LUCK!