15 Proven Strategies for Successful Real Estate Investment
Real estate is the safest form of investment proven for decades.
In our previous blogs, we discussed various types of real estate investments. This time let’s have a look at the various real estate investment strategies:
1. Buy & Sell:
This is the most common strategy. You buy a property at a lower price & sell it at a higher price. The difference is your profit.
This is for retirement planners. You buy a property & put it on lease & enjoy the lease for the rest of your life. This rent is a pension in old age.
3. Bulk Buying:
These are for real-time investors. You buy properties at a lower price. You sell it in small parts. This strategy requires huge capital.
This is the most common real estate strategy & in some countries. You buy a dilapidated property at peanut prices & refurbish it. Then you sell it at a higher price & make profits.
This a proven strategy but difficult to understand & manage. You buy a property & finance it. You buy another property from that financed amount. In this manner, you build an empire.
This strategy is for startup real estate investors. You buy a property which is livable cum leasable. You live in it till the time you can afford another property. Then you shift into another property & put the existing property on rent.
This is layman’s strategy. You buy a property & live in it. You sell it as its value appreciates. When the value of the property appreciates you sell this property at a profit & buy another property. This enables lifestyle upgradation.
8. Buying as a Group:
This is purely an investor’s strategy. A group of people pools money together to buy a property that possesses high return potential. This property is later sold at a higher price & the profits are proportionately divided amongst the group.
This is a businessman’s strategy. You buy a property and put it on a long lease. The property value appreciates due to the rental yield. You further sell this property & make profits & cycle continues.
10. Fix Returns:
This is a high-risk profile investor’s strategy. This is not recommended for all. You invest money in real estate where the sellers assure a buyback with high returns within a fixed period. At the end of the decided period, the seller buys back the property and returns the money with assured profits.
11. Buying at inception:
This is a traditional strategy. You buy real estate during the planning stage or during the inception of the project. You get possession of the property five to seven years down the line. Till then the value of the property appreciates and you sell & earn profits. This strategy also involves less initial capital.
12. Tax Benefits:
There are various tax sops available by the government & can realize good profits. You should invest in property in consideration with your real estate consultant. This will result in tax savings & asset creation.
This is a complicated strategy. It is apt utilization of the financing options available in our country. This is similar to strategy no. 5. The only difference is you refinance the existing financed property & create another property or asset. This improves your real estate portfolio by leaps & bounds without large capital investment.
14. Buying-Fragmented Leasing:
This is again a pure business strategy. You buy a larger real estate & then subdivide it into small portions. These portions are further leased to different lessees. The rents increase as the value & demand increase.
Real Estate Investment Trust is similar to mutual funds. Here you invest in these fund houses that further invest in commercial properties which possess huge return potential. This is relatively a new concept in India.
Always plan an investment strategy in consultation with the best real estate consultant near you. As the strategies require continuous monitoring & adaptation to the dynamic economic world.
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