Tips For Buying Investment Property

Buying an investment property single-handedly could be a complicated and overwhelming process, especially if it is overseas. Some of the hurdles you might face through the process include,

  1. Choosing a favorable neighborhood
  2. Selecting the right property with all the desirable amenities nearby
  3. Allocating enough time to contribute to all aspects of buying
  4. Analyzing the prospects of the house
  5. Fixing the right budget
  6. Succeeding to fix a desirable price
  7. Understanding and performing paperwork

These are some of the issues you have to face if you plan to buy it on your own. Without a realtor you might end up paying a fortune for a house that is nowhere near to deserve a price like what you actually spend. So the number one tip would be to get the job done from reliable realtors who have the experience and expertise in handling investment property of all sorts.

Here is a quick guide to help you get through the process of buying a worthy investment property anywhere in the world.

Finding the right property

When you decide to buy a house, condo, townhouse or a vacation house for an investment property, give more importance to the neighborhood quality than the size of the home. Another aspect that you probably should vote for is for a house that favors a shorter commute to the city’s main locations.

Determining affordability

Don’t go overboard as you come across various properties. Be clear with your priorities among which your budget should be your primary concern. Hire a realtor who has vast knowledge of his sector and is efficient in the process of not only finding your dream property but also closing the deal for an affordable price. A realtor with such credentials will be able to determine your affordability Vs the cost of the property.

Determining comparable properties for sale

Instead of blindly playing by the rules, follow your instincts by comparing the cost of the property that you select with all the other similar types of properties in that locality. Your realtor would able to assess if the property that you have selected is worth the quoted price.

Accurate documentation

If you are a first time buyer, especially if you plan to purchase an overseas property, you have to be clear with the analyzing and performing of all the paperwork and documentation. If you find it beyond your realm, a realtor on the other hand would be well-versed in what is to be done and also makes sure if it is done correctly.

Property Investment in Central Bangkok

Property investment in any capital city becomes highly lucrative, especially when the property location is in the heart of the city. Bangkok, the capital city of Thailand, is not an exception to this. Buying a property located at the city center of Bangkok is very good. It can ensure you a very good return at the time of selling the property. Choosing any property along the route from Siam Square to the Asoke junction is always worthwhile. This is probably the most costly and important area in Bangkok. This area is well-connected with various important parts of the city.

If you target a property to buy for living here permanently, you will get ample scope to enjoy almost all facilities and modern amenities which the city has to offer you. You can go for buying a property in this location when you have a higher budget. If you are seeking a property in Bangkok with a lower budget, you can target the city’s southern, northern and western districts.

This article will include only the property options in central Bangkok. I will write on the property options in southern, northern and western districts of Bangkok in my next few articles. Therefore, keep following the next articles to get an idea about the Bangkok real estate market.

Property Options in Central Bangkok

It is an undeniable fact that the property for living in Central Bangkok is comparatively low. The reason is a vast majority of the complexes are dedicated to commercial uses. Consequently, there is a shortage of residential properties. Therefore, if you look for a residential property to invest in this area, you need to search for a longer period of time. You will find no new Bangkok townhouses or vacant land allotted for town-house investment from the BTS stations to Siam Square till Ekamai (middle Sukhumvit. From BTS stations to Ekamai all way up, there are numerous commercial properties for doing business. Therefore, finding a module for opening a business is easier than having a residential flat in this area.

If you are looking for a flat in Central Bangkok, you can move to Chit Lom or Chidlom. This area is just one stop ahead of Siam square in the east. Although the proximity of central Bangkok has made the area costly, it is much lower than any location from Siam Square to the Asoke junction. Chidlom is basically a high-rise condominium. This skyscraper consists of two towers- Tower A and Tower B. it is a 24 story building having more than 597 units for comfortable living.

It includes almost all modern amenities within it like:

• Swimming pool
• Fitness center
• Green place
• Water body
• Arabic room
• Function room
• Game room
• City View
• Gym room
• Steam room
• Garden
• Covered parking
• Children’s room
• Playground
• Clubhouse
• Function room
• CCTV surveillance 24*7
• 24-Hour security
• Keycard entry

Try to invest here for the proper utilization of your money.

14 Reasons You Must Consider Owning Rental Properties

I was a 24-year old MBA grad know-it-all. I had life perfectly figured out and I certainly knew everything about investments. Working in the finance industry for a large multi-national firm, I often worked with high networth business owners. Much to my surprise, these multi-millionaires almost always invested in real estate and were generally seeking out new ways to capitalize on real estate opportunities. I was perplexed, didn’t these highly successful business men and women know that the paltry returns of real estate were minuscule compared to the stock market? I mean, I could show them many “Wall-Street” reports that concluded real estate was a really poor investment compared to stocks and mutual funds.

It was almost a full decade later that I would begin to seek to understand real estate investing in earnest. Thankfully, by this point life had taught me the importance of humility and, that much to my surprise, maybe I didn’t know everything. I began to quickly see that with real estate, the “cards are stacked in your favor.” You enjoy the tremendous benefits and advantages that the wealthy have throughout time. The economic structural systems and tax laws are designed for your benefit! I was excited and started learning as quickly as I could.

Rental properties have historically been the #1 wealth building strategy in real estate. You borrow money to buy your asset and then have someone else pay for the costs of your asset as you enjoy the benefits of appreciation, equity build-up, tax advantages, and cash flow. What a system!

Here are the 14 reasons you must consider owning rental properties.

1) Leverage (OPM)

The most powerful tool in real estate! You can typically borrow between 70% – 80% of the cost of the property and yet still receive 100% of the benefit of appreciation. OPM stands for Other People’s Money and is what helps fund your deals.

2) Someone Else Pays the Expenses

A good rental property is one where the rents paid by the tenant more than cover all of the expenses associated with the property and yet you still receive all of the benefits, including appreciation.

3) Appreciation

Typically home prices increase in value over time. According to the Texas A&M Real Estate Center, the median list price for a home in the Austin/Round Rock, TX MSA in 1990 was $72,252. In 2015 it was $260,000!

4) Loan Paydown / Equity Buildup

Even if you do not have much equity when you initially purchase the property, without contributing any additional capital you can build up significant equity. You get the duel benefit of using the rents collected to paydown on your mortgage while simultaneously enjoying appreciation. The house is now worth more in value than when you bought it and your loan balance is now lower than the original amount you borrowed. Over time, these two factors are significant!

5) Tax Benefits / Deductions

Most expenses associated with the cost of ownership can be directly deducted from any income you receive on the property. The tax benefits of owning real estate are extensive and are definitely worth exploring.

6) Depreciation

So even though as we discussed earlier home prices historically rise over time, for tax purposes you get to “depreciate” a certain percentage of the value of the rental property each year. Depreciation, which is an expense for tax purposes, serves as a powerful income shield.

7) Inflation

Inflation normally has a very negative connotation for most people. As a real estate investor, you put the power of inflation on your side. As the cost of living increases, you concurrently increase rent. The loan payment is fixed and you are now paying back the loan with “cheaper” dollars. Inflation is a great ally for debt financed properties!

8) Yield (Passive Income)

One of the key problems facing retirees is where to achieve decent yield on their investments. Real estate offers incredible passive income once the note is paid off.

9) Positive Cash Flow in Interim

Until the note is paid off, a good rental still returns several hundred dollars a month in positive cash flow.

10) Hard asset / Less volatile

With real estate you have the security of a hard asset that you can drive by and inspect at any time of your choosing. Additionally, although property values can go up and down, real estate is typically less volatile than other asset classes.

11) Own Property Free and Clear at End of Note

If you have a positive cash flow rental, other than the initial down payment, the rents collected from tenants have paid for all of the costs associated with the property. Once the loan is paid off, you now have an incredible cash flow producing asset with no debt attached to it.

12) Easy to Refinance

As property values increase over time, rental properties are relatively easy to refinance. This allows you to pull out equity and move it into other great property opportunities as they come along. Your initial down payment on the first property could serve as the equity that springboards you into many others.

13) Timing

With rental properties you decide when you sell. This is critically important for any tax minimization strategy. Additionally, by controlling the timing of a sale, you may also be eligible to capitalize on tremendously positive tax deferment programs like a 1031 Exchange.

14) Financial Freedom

This is the ultimate goal and what makes all of the hard work worth it! With long-term ownership of rental properties, you are able to create enough passive income that all of your living expenses are covered. You have no financial need to work at a job and have the freedom to pursue work (or any activity) for fulfillment.

As you can see from the list above, the economic structural systems and tax laws truly do benefit real estate investors! Is there any wonder why all of the successful, high networth business owners I came in to contact with utilized real estate as a wealth building tool? Real estate truly is an amazing tool you can use to transform your life!