TOP SECRETS TO INVESTING IN RESIDENTIAL REAL ESTATE PROPERLY AND LESS RISK

Top secrets to investing in residential real estate properly and less risk

1. Flipping

This is a well-known form of investment. Flippers often target potential real estate projects. They buy real estate products under that project when the opening price is still low and are supported by the investor's sales policy. Obviously, before investing, investors must research the potential price increase of the project in general and the intended investment product in particular.

Real estate is a high-risk investment market, so investors need to master the know-how when investing.

As for buying and repairing a home then waiting for a good price to resell in practice is not as quick and easy as in theory. Investors who buy houses to wait for resale must rely on actual factors in the market to find suitable customers and sell them at a suitable price. The time it takes to sell a home can take several months to several years, depending on the location, suitability, and price that customers can accept to buy back.

2. Problems encountered when selling the house

Waste time

As noted above, selling a home usually takes several months or longer. Although it is a newly built house, if left for a long time, the condition of the house will show signs of deterioration. Investors need to be patient and take care of the house regularly, cleaning inside and outside around the house to keep it as fresh as possible while waiting for sale.

Personal costs

Not-so-new homes intend to sell. Homeowners want the highest possible sale price, so they spend some money on repairs. However, home repairs should be considered financial. Do not spend more than 10% of the purchase price to repair the house. At the same time, homeowners should set up a provision to spend for problems arising during the repair process.

Take risks

The real estate market always has potential risks that investors must accept. In fact, the sale of a house will face many difficulties or problems during the sale process such as being forced to sell, unable to agree on the terms of the contract, after making a deposit, the buyer does not want to buy the house anymore, etc… Risks can come from many sides, investors need to carefully understand the market and sometimes have to accept risks when investing in real estate.

Pay attention to your price

The price of a house is affected by factors such as location, investor, regional convenience, regional economy… When investing in housing, investors need to consider the factors that affect the value of real estate. Currently, many projects have product selling prices at a higher level than the actual market, which makes it difficult for investors to invest in that project. However, this also shows the cost of that project at the present time and the potential profit in the future.

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Investors need to choose an investment form suitable to their financial conditions and understanding of the market.

Collaborative relationships

Invest in a high-value real estate product but the capital is not enough. Investors can cooperate with others to invest in the desired project. This helps to reduce the financial burden and risk incurred when investing. However, investors will not get a high return as when investing alone.

3. Many people choose to rent instead of sell

Homes that are not in a good location or because the owner is no longer living but still wants to own the home. Then, instead of fixing it to sell, sometimes the price is not as expected, they decide to rent it out. Renting is now very popular and tenants are often easygoing and less interested in the location of the house than real estate investors. As long as the area is secure and not far from the workplace, the city centre or the busy business area, it is an ideal rental location.

When renting the house, the landlord also needs to repair it. High-risk damage should be fixed before renting. Although tenants are not too fastidious in finding a house to rent in a beautiful location, they pay more attention to the space inside. The rental price can also be high or low depending on the quality of the rental space. Therefore, landlords need to repair and equip reasonable equipment to offer an appropriate rental price.

4. What should be paid attention to when investing in the rental segment?

Suitable investment project

Investing in rental housing is a long-term investment. When investing, homeowners get a steady income every month. However, the revenue is not as high as when buying and selling real estate. This form of investment is suitable for people whose homes are no longer in use but cannot be sold or do not want to sell. In addition, investors choose this form of investment because they want to avoid the risks of selling. Although the income is not high, the rental will be safer for investors.

Possible risks

Although this is the most stable form of investment, there are still risks that homeowners can face. For example, tenants are late in paying rent, which leads to the landlord's financial plan being affected, or it’s difficult to find tenants in the long term because of social factors, etc… Landlords need to understand the rental market situation to anticipate risks and sometimes need to accept force majeure situations.

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To get the expected revenue, investors should refer to potential projects.

Increase rental value

If you want the rent to be high, but there are still people who want to rent, the house must be aesthetically pleasing. Currently, many apartments are rented in the form of luxury apartments or fully furnished houses for about 20 million VND per month. Typically, for renting a whole house in District 2, there are now many places that provide high-class houses for rent in District 2, with modern furniture. Many people wishing to find a house for rent in District 2 often have good finances and these people often choose to rent a whole house in Thao Dien District 2 - which provides many high-class, modern and comfortable serviced apartments. Landlords here also get a higher monthly income when renting houses in Thao Dien compared to many other areas in the city.