A long term decision which can consume your finances, time and physical as well as mental efforts over a long period of time is a real estate investment opportunity.You cannot just buy/sell a property as your money and efforts can be at stake if the decision goes wrong. Make your investment wisely after analyzing pros and cons of all the investment opportunities carefully.
PranavPuri, the top realtor in Brampton, Ontario, says that this is sometimes an irreversible decision as lot of money and time may be involved. There are majorly five types of real estate strategies and you must introspect as to what is the purpose of your real estate investment.A quick glimpse through the following five investment opportunities will help you see what works in your vicinity and what is that you want:
- Short Term Rental Properties
Properties rented for a short time like those on weekly basis or chargeable for a night are short term rental properties. This is similar to Airbnb properties. The best real estate agent in Ontario, PranavPuri says you must analyze the opportunity keeping in mind the following points:
Location can help you earn brownie points and if it is centrally located you are likely to get twice the rentals.
A negative review clearly means no further clientele. All efforts must be made to make the client happy.
- Long Term Rental Properties
Traditionally rentals were considered long term and this investment opportunity can ensure a stable income flow over a long period of time. In this opportunity you may rent out the property to a landlord for a longer period of time, say over six months.
Long term rentals are a fixed source of income. However a careful analysis of the investment opportunity must be conducted and Pranav warns you to be watchful of the following points:
- Potential tenants
- The long term implications of renting out the property
- Real Estate Wholesaling
Usually considered the best investment opportunity, wholesaling involves buying a property and selling it tosomeone else in a short period of time. The whole idea is to make money out of price fluctuations in the property prices.
Pranav is now widely acclaimed as the most reliable realtor in Brampton and suggests conducting an investment opportunity analysis and focus on the following:
- Look for an ideal property- The property which is of lesser value now but is likely to be sold for a higher value is the most profitable.
- Negotiation Skills- In case of wholesaling your negotiation skills and acumen will fetch you the best prices. In case you are not proficient enough, hiring the best real estate agent around you would be an icing on the cake.
- Fix and Flip
For an investor who can buy a real estate property, fix it and then sell it, fix and flip is the best investment opportunity. The secret tip is to find and look out for properties which need less repair and maintenance and the services of a good real estate agent are mandatory for this.
The chain is ongoing as you can reinvest the profits of the first fix and flip deal into buying and selling two or more simultaneous deals and catching on the profits. A great deal of hard work, efforts, time and planning is required for the success of fix and flip
- Buy and Hold
This is the most long term investment opportunity where you will buy a property and hold it to be sold in the future when the prices escalate. Pranav suggests renting out the property in such cases so as to avail steady rental benefits till the time the property is sold. This is a long term strategy and can generate long term profits.
Using a few basic calculations you can compute the cash flow in the pocket by calculating gross rent multiplier (GRM), Net Operating Income (NOI) and Capitalization rate (Cap Rate). These will help in estimating the long run returns and the utility of the investment opportunities. With the help of a proficient realtor, you can actually invest in a suitable real estate proposition and make money work for you.The vision and far sightedness of a realtor can help you fetch good returns in the long run.