Beginners Guide to Investing in Real Estate Properties
Here are some of our tips to get you started on this journey.
So many people have fallen victim of this: bought premium lands with high expectations only to find out later that they cannot build some structures there due to one regulation or the other. Please, have all the facts before putting your money where your mouth is. Your property as is to be acquired must be ‘Free from Government Acquisition’.
Examples of such legal and perfected titles include;
▪ Certificate of Occupancy
▪ Deed of Conveyance
▪ Court Judgment
▪ Right of Occupancy
For any land to have any of the above titles, a registered survey must exist which shows the legal boundaries, shape and type of land that is being described.
Calculate your expected cash flow/profit based on facts and historical records. Understand the trends for urbanization, commercialization and increasing migrations if any, calculated correctly, these can make for very clear and viable opportunities for investment in which case, your return on investment can even be increased or maximized such that you also can either resell to other interested investors at some point down the line or develop a mass impact project. Ask questions; what do other buildings around also charge? What’s the tenancy/occupancy rate for similar buildings in the area? How much will maintenance cost? Cover all angles before jumping into the waters.
There’s a simple saying “Pennywise…Pound foolish”. This aptly describes the situation many investors/developers find themselves after trying to cut costs. While ensuring that you make judicious use of money as much as possible, please use professionals where necessary. If you do not, and you end up making wrong choices, you could find yourself spending more money at the end of the day. Other components of a due diligence would and should include a confirmation that the property is not under any form of litigation between parties or being held in escrow for an existing credit line. You Contact us at MoneyEstate, let know your Real Estate investment plans and needs, we will be happy to be your trusted real estate agent guiding you through your journey into real estate investing.
Once your checks tick all these boxes and the property has been purchased by you, it is imperative that you take legal possession by registering the acquired property in your name by way of a registered survey for your expanse as well as an executed Deed of Assignment from the company thereby signing off ownership to you. Another way to take ownership of your landed property is to fence and gate it. This way you don’t have wanderers creeping and encroaching on your property. By the time someone wants to develop across the boundaries of what is supposed to have been your land, it won’t be as easy to just break down your fence and start building.
In our experience, we find that once a buyer has taken ownership by way of fencing and gating off their property they are more attuned or interested in filing the paperwork for the documented titles to be registered in their names. This is where the question about Certificate of Occupancy most certainly comes in because they might be better equipped to get a Governors Consent instead.
Top 3 Types of Real Estate Property
The vast majority of real estate agents and brokers work with three major property types accounting for most of the real estate ownership transfers. They include:
Land does not only increase in value as it ages; it is also what drives real estate appreciation. When the population and economic activities of a metropolis is constantly increasing, more people will come into the area and will need shelter thus more and more properties will be built, land becomes more and more expensive. The opportunity forgone on real estate appreciation is getting higher by the day as prices have continued to rise during the past several years.
Residential property is by far the most popular real estate properties. Residential Properties can be further broken down to include new construction, condominiums, separate homes, duplexes, rental properties, Real Estate Owned properties (REOS) which are properties generally owned by a bank, lender, government agency or loan insurer as result of foreclosure and failure to sell at foreclosure auction) or high value homes, vacations homes, etc. There’s plenty to go around.
Commercial property can be empty land zoned for commercial use, or an existing business building. Commercial property valuation requires a more complex accounting method including income potential of the property, historical revenue, cash flow with owner perks removed and much more. They include office buildings, supermarkets, shopping malls, industrial, gas stations and other commercial property types. Sub-niches, such as strip malls and shopping centers are also common.
MAKING REAL ESTATE WORK FOR YOU: LIFE IN THE KITCHEN. LERATO LEKENA-OKORO
Beginners Guide to Investing in Commercial Real Estate