Tuesday, August 22, 2017

Beyond The Basic Real Estate Investment

real estate ideas
First and foremost, it’s probably important to discuss what “basic” means in this context.

A basic real estate investment would be a property that is replicated throughout the country. The serviced condo; the detached family home; the city apartment designed for young professionals. The kind of investments that you can find in any state, perhaps even any country in the world. 

These basics keep the real estate market afloat. They’re not bad investments, but they do have one substantial drawback: there’s just so many of them. 

Competition In Real Estate

Whether you’re investing to then sell on or you want to find a tenant, one of the aspects of the process you’ve got no choice but to deal with is competition. The first form of competition comes from a natural source; regular folk who are buying and selling their homes as part of the normal life process. There’s not much you can do about these people, so they should be discounted when it comes to figuring your investment plan.

The competition from the second group, however, is much in need of consideration. This is the competition from other real estate investors and developers; your direct competitors for both buyers and potential tenants.

The “basics” remains very popular with the second group, your direct competition. There’s a very simple reason for that; they might not be exciting properties, but they are easy. These are the times of homes that will always eventually be able to find a buyer or a tenant, so they’re a more surefire bet. That means if you choose to invest in these properties also, then you’re going to be aiming for a slice of the market that’s already very well catered to.

When To Break Outside Of The Basics 

If you break outside of the basic kind of investment properties, yes, there is a risk involved. It means that you’re going to be lowering the number of people that might potentially be interested in the kind of property you have chosen. 

However, the number of potential buyers and tenants might be reduced - but it’s still higher when compared with the saturated of the “basic” market. So if you choose to invest in unique and interesting real estate, such as properties that are at height or have an unusual layout, then you’re still going to be able to find buyers. There might not be as many at first glance, but for the buyers that do want something different, their choice of properties is much slimmer. The math adds up - and it’s in your favor.

The Extra Bonus 

Finally, when considering breaking the mold and opting for something different and unusual in terms of your real estate investment, it’s important to remember the financial aspect. If a buyer wants something more unique, they are probably well aware they will need to pay a premium for it. That means your profit margin will be higher when it comes to sell. 

So do you think you might be tempted to a non-conventional property investment?

No comments: