There are many ways for you to get started with property business. You may have seen plenty of successful investors in this industry. However, you need to remember that they have their own way to reach the place where they are now.
Each of them may use different strategy that work well with their plan. However, it doesn’t mean you will be as successful as they are when you try the same strategy.
As an investor, you also may have heard that the lower the purchase price of property, the bigger deal it is. However, it is not always like that. You still have risk to buy property that can cost you money.
Therefore, it is more likely about what kind of property you are going to invest in, what your goal is, and how you will handle them.
What about low cost properties?
Many investors show interest to invest in low cost properties, considering it has higher chance to gain more profit. You can buy a low cost property if you are interested but it is also highly recommended to find out more about it before making any purchase:
- Low cost property usually cost under 50,000 dollars. Sometimes, it is in a form of a property with severe discount. However, it is also mean that the property needs more work or need to be located in undesirable location for the price to be that low. Thing you need to consider of low cost property is the location. This will help you to find out if you can do anything about it. You can make your own research about the market, listings, etc. If you cannot find anything promising, it is better not to purchase it.
- Low cost properties are usually in need of repairs which cost a lot. It is because this type of property is usually a decade old or under maintenance for years. You need to calculate how much work needed to resurrect the property. You may need to do major repairs which honestly cost amount of money. If you find that the cost is too high to handle then it is better not to purchase it since it won’t earn you benefits anyway. Or, you can also choose another alternative in which you sell for a small profit. However, you need to check and calculate thoroughly before deciding to purchase this type of property.
- The next thing you need when it comes to investing in low cost properties is exit strategy. You need to decide what kind of strategy you will use to make them more valuable. However, adding too much value on the updates might cost you the amount of money with no guarantee that it will pay back. You can also choose to rent or sell it after updating here and there. The point is, no matter what plan you make, you need to make sure you make thorough calculation so you can make multiple exit strategies. Therefore, you can avoid severe loss.