Investment property is a real estate property that has been purchased, owned or managed with the intention of earning a profit, either through rental income (Yield) or though capital gain of a future resale option.
Real estate is an asset form with limited liquidity which required Investment planning, Property Investment Strategy is generally related to Generate Yield, ROI - Return on your investment, Capital Gain, Development and Flipping Property.
If there are factors that are not well understood and managed by the investor, real estate can become a risky investment. The primary cause of investment failure for real estate is that the investor goes into negative cash flow for a period of time that is not sustainable, often forcing them to resell the property at a loss
Successful Property Investment in Thailand require skill and Knowledge, a lot of research and education and risk but it can be a well calculated invested risk. The way in which an investment property is used has a significant impact on its value. Investors sometimes conduct studies and create a Property Investment Report to determine the best, and most profitable, use of a property. The Commercial Term for this is often referred to as the property’s highest and best use.
Here are some lessons that might help ease some pain on your property investment journey: -
Understand ALL the costs involved in ownership – the cost to get in, the costs of management, repairs, maintenance, rates, taxes and of course those involved in exiting when you sell your asset.
Yield - Choose a Good tenant is critical and when you have good ones that will take care and maintain of your Asset. Having a rental manager Agent is a great idea but stay involved, ask questions, inspect the Property at least yearly and insist on getting a report about any upcoming maintenance.
Capital Gain - Capital gain is a rise in the value of a Property that gives it a higher worth than the initial purchase price. The gain is not realized until the asset is actually sold. A capital gain may be long-term (more than one year) and must be claimed on income taxes or short-term (one year or less) in this case we will call it Flipping Property.
Return on Investment (ROI) - is a way to measure and evaluate the performance your investment.
ROI measures the amount of return on an investment in Percentage or Time, relative to the investment’s cost. To calculate ROI, the return on an investment is divided by the cost of the investment.