Investment experts have said it time and again: the sooner you invest, the better. While young adults, especially those in their 20s, may not be too eager to consider investment plans due to lack of financial stability and the desire to enjoy their youth while they can, it’s actually advisable to enter the investing world now in order to reap the benefits later. Investment property, in particular, is considered as one of the most secure and viable wealth-building strategy as it is less volatile than shares or stocks, and increases in value over time. And young investors have an edge over those who invest later in their life – time.
If you’re a twenty-something who plans on taking the property investment route to generate an ongoing income source and, consequently, achieve financial independence, the following tips should be kept in mind:
1. Educate yourself
Any investment, whether big or small, must be made through careful planning and research. Thus, before you purchase property, you must learn about key market trends and the risks involved in order to determine whether investing in property is for you. You can do this by reading resources, talking to people who have been in the market for a long time, and consulting professionals who can walk you through the steps and processes in investing in property. Real estate investment can be a lucrative investment option once you base your decisions on logic, not luck.
2. Set clear goals
Once you decide that you are ready to invest in property, you must then establish a set of goals as this will help you remain focused and avoid being overwhelmed by the challenges that young investors are bound to face. List your goals, be it a protection against inflation, funding your own retirement, or preparing for a luxurious overseas trip. These objectives will serve as a guide in choosing a property or developing an investment strategy that meets your needs.
3. Know your market
The real estate market is a competitive one. For beginners, it is advisable to set your sights in an area you are familiar with, at least for your first properties. A well chosen property can yield higher returns over the long haul. Thus, make sure you buy property close to schools, public transportation, public facilities, or areas experiencing population growth. But along with knowing what to buy, comes the question of when to buy. The property market cycle will ultimately dictate how you will go about this; hence, it’s essential to understand how the cycle moves to acquire a property at the best price.
4. Get the right financing
Self-financing and availing of loans from banks or other financial institutions are two of the ways young investors can fund their properties. However, it’s a given that most people in their 20s often lack a steady source of income that would be able to finance their investments, since some are still fresh out of college and may still be starting their careers. Lenders may also be hesitant in funding new investors unless you can provide evidence of consistent savings or have a partner who can act as a guarantor on the loan. Nevertheless, before you consider any of these options, you should be certain that you are capable of handling the risks involved; otherwise, it’s best to take the easy route – grow your savings first.
When it comes to investing in property, one is never too young to join and get ahead in the investing world. And when you need expert advice regarding property investments, we at Investment Property can be your trusted partner. Our skilled team can assist you in making informed investment decisions to ensure that all your investment goals are attained. We can also help you find real estate property that guarantees to deliver quality returns with our comprehensive investment property listings. Contact us now and take your first step to financial freedom.