Hey there! It’s Belle again – back with another #ApaJadi scenario where we answer your burning questions about property!
Today’s question is, what should I do if I want to invest in property?
Although it’s common to see others invest, it can still be nerve-wracking to start, especially as a first-timer who’s just beginning to dip their feet into the water. Nonetheless, once you get the hang of it, you’ll be able to reap great returns!
Read on as we answer your property investment questions!
Should I invest in property?
The perk of investing in property is that the value goes up over time, especially if the property is near an area with upcoming infrastructure upgrades – which essentially means it can be very lucrative.
Investing in property can be a good plan as a means to generate side income. Although it can be a pricey industry to enter, it can bring in substantial returns as long as you play your cards right. On top of that, investing in real estate as a secondary means of income can ease the approval process when you apply for loans, especially if it’s your first time investing. And now, incentives such as the Rent-To-Own scheme make it easier for those with regular income to buy property.
How do I start investing in property?
Before you start investing in property, you should pinpoint the purpose of your investment. Do you want to resell your property at a higher price? Do you want steady monthly returns?
If you’re looking to resell your property, you can find a relatively affordable property and sell it at a higher price. This method is usually best if you have a good understanding of the property market, and also entails a fair amount of research.
If you want to have a stable secondary income, you can purchase a property and rent it out to a tenant and collect rental income. You can also utilize the rental returns to pay off the loans taken for its purchase, if any.
The question is, which method is best for you?
Both methods come with their own pros and cons, as well as their risks. Identifying which method is the more comfortable one for you can significantly help you make an informed decision.
Once you understand what you’re expecting from your investment – whether it be to sell when the value increases or to have a steady stream of profits – it is up to you to decide how you would like to make your investment work for you!
What do I need to do to start investing in property?
You will need to take out a bank loan to make your purchase. Banks in Malaysia will fund up to 90% of your property value for your first two properties, and 70% from then on. Be sure to budget for the down payment, legal costs and other fees that may incur during your house purchase. If you’re purchasing an older property, consider the renovation costs that you may have to bear.
Which type of property is best for investment?
There are several types of property you can invest in: residential, commercial, retail or industrial.
If you want to have rental income, you can invest in residential property. This is usually the first-timer’s choice and is a very common form of property investment.
Commercial properties, on the other hand, can potentially offer better returns as businesses usually pay more in the long term, but commercial property usually comes with a hefty initial price tag – meaning a higher capital to start with. However, the maintenance fees are usually lower, so this can help lessen the burden.
Despite the oversupply of retail properties, the demand for them remains high. For a longer-term investment, you can look into retail and industrial property as well. The rental period for these properties is usually longer, and the properties are easier to maintain and require less capital.
In the end, there isn’t one right answer to the age-old question of investment – it depends on what you want to gain from your investment. Before you make your move, find out what your goals are, and make sure they are in line with your purchase.
Excited to embark on your investment journey? Start your first investment with us; with our extensive team of trained and trusted agents who can help you every step of the way!
