REAL ESTATE… What’s in it for you?

Have you ever come across a real estate ad and wondered what it’s got to do with your current situation? Given our current economic situation, it may seem ridiculous to be asked to invest when there isn’t enough money to settle your current expenses and even more so to save towards investing in a property. I’ve had a lot of people tell me they can’t buy a property where they can’t live or an area that isn’t fully developed or they’ll wait till they have millions before they invest. Unfortunately, a lot of people do not understand that real estate investment actually solves a lot of our financial difficulties rather than compound them. It’s just a matter of having full knowledge of the type of investment you’re getting into and the prospect of the location available to you.

There are so many misconceptions about real estate. A lot of people act like it’s about putting money in a real estate agent’s pocket or they’re only about the money but the truth is whatever the agent is in it for isn’t your major concern, the amount of money you’ll make when you invest in a property in a location with good prospect is what should be your priority, it’s easy only deal with agents that bring you investment opportunities in good locations. The most important thing you should know about real estate is, it is a profitable investment and it definitely will give you financial freedom if nurtured properly. Do you want to always depend on your monthly salary? Multiple streams of income is key to financial freedom, and real estate will definitely give you that. With real estate, you have control of your finances and eventually, you’ll stop worrying about debts and expenses. But like any other type of investment you have to develop it and most importantly understand the market you’re getting into.

FACTS

WEALTH CREATION

Most millionaires have a significant percentage of their wealth in real estate, you’ll wonder why, although the supply of real estate is limited to all the land available to us there will always be demand for real estate because no matter how bad the economy is people will always need a place to live, businesses will always need spaces to work and government will always need places to function. The fact that real estate will always be in demand makes investing highly profitable and sustainable. It’s just a matter of owning the right type of property in the right location at the right price.

CASHFLOW CASHFLOW CASHFLOW

It’s been said over and over again, real estate is about location, location and location.  But the truth is for any investor cashflow cashflow and cashflow should be what’s in mind; do not invest in a location that won’t yield positive cashflow. A neighborhood that will yield positive cashflow is that which is developing and undergoing a lot of capital investment carried out by individuals and the government, that way you’re assured of its prospect because individuals and businesses will be moving towards that neighborhood.  You see the amount of money you make from your investment is totally dependent on location. So when you pick up a flyer or see a real estate ad online or have someone talk about a potential investment make sure you do your homework and join the winners in investing in such a neighborhood.

THERE’S REAL ESTATE INVESTMENT FOR EVERY INCOME LEVEL

You don’t have to be a millionaire to start investing in real estate, there are some locations in Lagos state that sell land for less than a million, you can start from there and then build up. I remember years ago when people started buying land in Ikorodu for about N200,000 but now the value of land around there is worth millions, same with Ibeju Lekki, the value of land has tripled over the last couple of years. Real estate makes you millions not the other way around, yes you can invest your millions to make more millions but that’s what real estate does. So when you hear there’s cheap land in an area that’s fast developing, do your homework and make sure it truly is worth your investment and then BUY!!!

BE MORE THAN A HOMEOWNER

Some people buy properties in neighborhoods they want to live in eventually and just become home owners but that is just thinking small, how will you pay your bills and other expenses, your salary? How much money are you planning on making yearly anyway? When you’re thinking of buying your home you should also think of helping other people get their homes (for a price) You can also buy real estate to resell (quick cashflow) or put it up for rent (yearly cash flow). When you resell you’re no longer a landlord but you have enough money to do whatever you want but if I were you I’ll do it all over again, put more money in real estate.

FREEDOM OF CHOICE

With real estate investment you can choose what kind of investor you want to be, do you want to buy land and wait for its value to appreciate and resell because you have no interest in construction or do you want to buy land to build structures on it to resell or rent out. Or would you rather buy a house below the market value, fix it up to suit your taste and resale or rent it out. There’s so much to be done with real estate so start with what you can afford and think of the type of the investor you want to become and don’t forget you’ll have to nurture your investment. If you buy a plot of land today think of buying another tomorrow and another the day after and keep going till you’ve built a big real estate portfolio.

LOW RISK INVESTMENT

The value of real estate falls like every other type of investment, but it is not as bad as stock market crash or banks going bankrupt because even when real estate falls, you’ll still earn money from renting out your property. Real estate investment is not that which you’ll lose out completely although its subsistence is dependent on the situation of the economy, if there’s a boom, the value of properties will definitely rise and there will be enough money in the economy for people to invest in real estate and also to pay for house rent. On the other hand when there is a downturn in the economy, and prices are constantly on the rise the value of money depreciates and so does the value of properties. Tenants might find it difficult to pay rent but at the end of the day it is money owed to you, it might be a bit difficult to buy property at the time but eventually when the economy stabilizes, things will go back to normal. During recession, people might not have money to invest and some people might want to sell their properties below market value, this is good time for an investor to invest, it may seem risky given the situation of the economy but when the economy stabilizes and prices drop, the value of properties again will be on the rise.