What Type Of Property Investment Is Best?

When it comes to property investment there are many different kinds and each one has its benefits and disadvantages

. Which one will work best for you depends on your situation, you budget and to some extent your interest. What will work best for you will vary depending on the amount of capital you have to invest and whether or not you have the capacity to make improvements to the property or if you need to purchase as is properties that are in good condition. But, before making a decision you should know the options.

Below market value properties

Below market value or BMV properties can be very lucrative but there is a reason they are being sold below market. Often there are problems with the property and you can get them for well below market. However, in order to make a return on your investment they need to be fixed up. If you have the ability to either do it yourself or hire those who can get the property in good order and often make a significant profit on the sale. However, these deals should be looked into carefully because you can just as easily get into a financial bind with these schemes so it is necessary to carefully analyse the potential return.

Off plan property

A new developer of a community may pre sell properties to investors. Often the seller gives a discount but the existing sales will allow the seller to secure financing at better rates. This is beneficial because the investor will have a property at a discount and will make a profit once it is developed and sold. However, this is also a risky endeavour because many things can go wrong and there is no guarantee that the sale will be for more than the purchase price.

Auction property

Auctions can be quite lucrative when looking for a property investment. However, there are a few things that can go wrong. If you cannot carefully analyse the property prior to auction to determine the maximum amount you are willing to purchase it for, you may wind up paying more than it is worth and you may have difficulty recouping your investment.

Overseas properties

If you have a reputable and trustworthy agent, overseas investments can be quite lucrative. However, for the novice investor this is probably not the best starting point. You need to have an advanced knowledge of property investment and have an agent you can rely on to seek out properties and act on your behalf. Without it you may find that overseas investments are more trouble than they are worth and may actually cost you money.

Investing in property can be a lucrative means of increasing wealth. However, as with any investment there are risks involved. You should understand the financial position you are in and what types of investments would be the best for your particular situation. If you are just starting out, invest in something small at first and expand your holdings as you get experience.

by: Lawrence White

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