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Pros and Cons of Property Investment

The two sides of property investment, thoroughly covered by SpotMe. Learn more here.

Consider these points!

Investing in a property requires a huge amount of fund, do you think the amount of money spent would benefit or hurt you? To guide your decision on property investments, here are some things you should weigh on.

PROS:
Source of income
Investing in property means your asset could be put out for rent. If you’re lucky enough, the rent would help cover your expenses and even pay off the rest of your mortgage. The best part is you can make a living from renting out your property if, the money you earn is a positive cash gain over the expenses and mortgage. You can also earn money through different daily housing rental services when you have no actual tenants.

It’s tangible
When you pour your savings into buying goods or services, you get pleasure from being able to see, touch or get access to it. Different to stock in vestment, property investment comes in a physical form of asset that is tangible. Therefore, giving you more assurance where all your money went.

Benefit more in the future
Property investment is known for its benefit in the long run, as it is considered as a long-term investment. If you plan to gain from your investment in the future, property investment would be advisable. As time flies, inflation rates would progress and so will your property, accustomed if you invest in the right area.

Volatility is less
Although property investment has its ups and downfalls, its volatility is less and the investment could be considered stable, this is generally because a property is harder to sell and there is continuous demand.

CONS:
Slave to the property market
As the property market is easily affected by economic changes, there are chances your property value would rise and fall. If interest rates rise, your disposable income might be squeezed. This results to you being a slave to the property market as you are constantly looking out for changes and its effect on your investment.

High barriers to entry
Different from other investments, investing in real estate signifies the need to have a lot of money to be able to begin. If you have very minimum savings and decide to invest, you might find it difficult to start as property prices continuously rise.

The cost could exceed income
When it comes to property investment there are costs that you might not be able to avoid and will continuously struggle to cover. Thorough planning would help you avoid paying for cost such as mortgage repayments, insurance, interest, strata fees, council rates when it hits you in the face. You need to, therefore, make sure your rent prices outweigh all these costs.

Have you finalized your decision on property investment? Here are some factors to consider when you have plans to invest your money in property investment. Plan thoroughly and apply for short-term loans with SpotMe, to get a kick start in your investment plans.

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