Buying a property has been the dream or long term goal of every working person. We have seen many people secure their living by investing in property. If you have the knowledge, information, skills and guts, than investing on property can be a great investment. Property should increase your wealth and give you financial security. Savings account, stocks, shares and bonds have always been the traditional areas where people have invested, but the risk factors involved has made property investment a more genuine choice for people who are looking for retirement plans and steady income. In India, investing on property or buying gold has always been the areas where most of the Indians have invested. Investing on property has always been a popular idea for most of the Indians over the years.
There is always a difference between a home and your investment property. You can always earn from your property investment through rental income or from any increase in the value of the property. If you own a home or a residential property, you will always gain from rising property prices. To broaden further, you can also invest in commercial property. Before investing on property we should always look at the pros and cons of investing. Investing in property has two types of potential returns, one is rent income and the other one is from increase value of the property in future. Experts usually advice people to invest in properties for long term profits. Although property has been a popular area for investments, there are some potential risk factors involved. For example; for some reason you might need to sell your property at lower price, when the value has dropped; selling a property can be difficult sometimes; income from rent cannot be guaranteed and it can affect your Property investments.
Apart from buying property directly, you can also invest in property funds or managed funds that buy commercial properties like office building, warehouses or shopping centers. These funds may own property directly or they may own shares in other funds that own the property. When you invest in managed funds your investment is converted into shares in the fund, then your shares are combined together with other investor’s shares and invested in properties. Property funds can also be used for buying residential property or developed properties. The main advantage of investing in property funds is that you don’t have to deal with the day to day issues of a landlord. A managed fund gives you the opportunity to own properties without having to undergo the hectic process of finding it. It also gives you the opportunity to invest in other fields. Property funds are useful for investors, who are looking for long term growth. With all the benefits, there are drawbacks too. For example, the value of the property in which you have invested through managed funds can fall, which means your investment value will decrease; Buying or selling a property is a difficult job. If you do proper research and take right steps at the right time, investing on properties can be a good area for investment. It can be a steady source of income
Image Source : Flickr