Property Investment

Any property that is obtained in order to win and expect a return on investment is classified as property investment. Property investments may be in the form of a block of flats, family homes, houses, apartments, vacant land or commercial property.  Property Investments in long-term properties usually refer to the properties that the landlord not to rent it occupies but in some cases the owner may occupy a part of it and make a profitable business. NRAS Property Investments s a profitable place to make money.  Property investment is an exciting way to earn substantial returns. In the property terms, you spend a certain amount of money in buying investment properties in demand, and get returns in 2 forms:

1)    Capital Gain

·         You buy the property at low cost and sell it at a higher cost.

·         It is not necessary that the property has been completely developed. You can buy a house that is in the planning stage and sell it before it is built.

2)    Rental Income

·         You can rent the property that you own. The rental income provides steady returns.

·         A smart model of investing is to take a partial loan. Ensure that the installment of the loan is covered with the rent that is received every month. In this manner, your purchasing cost is only a part of the property value. This model also isolates you from banking pressures as the installments are covered with rent.

For the buyers the main aim is to buy an investment property that will gain in capital value in the years ahead and/or provide a rental income - either now or in the future. This doesn’t necessarily mean buying huge investment properties at huge prices. In buying any investment property there are certain costs involved which include:

·         Purchase Cost: The cost of buying the investment  property

·         Maintenance Cost: This may include payments to the society watch, utility bills, garden upkeep, occasional cleaning maid and any other mandatory payments like security etc. In the case of rentals, this cost is covered by the tenant. These maintenance payments are made irrespective of whether the property is in use. You may appoint a real estate management company to look after your assets.

·         Financial Cost: This is the cost of money that gets added to the purchase cost. Let’s say you have taken 50% loan to purchase the property and you are paying interest to the bank. The interest is the financial cost.

·         Registration / Transfer Cost:  This is the cost involved in getting the property registered. Upon sale, the property needs to be transferred. Sometimes there may be costs involved in this activity.

·         Commission / Premium: Sometimes there is a premium above the basic purchase price that is paid. Some property dealers charge a commission to the buyer.

·         Insurance: It makes sense to insure the property, even if you are not renting it or living in it. A basic theft and damage due to natural causes like floods, hurricanes etc. Policy would be necessary to protect the investment.

·         Evaluation Costs: From the time of purchase to sale, you will evaluate the property multiple times. Try to roll these costs on the other party.

·         Odd Costs: These are normally small costs that arise out of unplanned and unforeseen circumstances. This may include pipe breakage, cost of eviction etc.

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