Property business is also for young and not-so-richWith interest rates at historic lows and supply being abundant, the time is ripe for investing in real properties.Contrary to common notion that it is fit only for big enterprises and the extremely rich, the property business is also something the young professionals and the not-so-rich can engage in.“While an individual is young, that is the best time to start building one’s property portfolio,” Carl Dy, Property sales coach and Ayala Land Premier sales director tells SundayBiz.Ayala Land Premier is the developer of the group’s most expensive projects.At 34, Carl already has several properties in his portfolio from which he earns extra income, mostly from rent.The property sector in the Philippines has continually grown over the past three years as evidenced by the growing number of condominium buildings among other real assets.Because Asia is seen to continue driving global economic growth in the years to come, emerging markets in the region like the Philippines are expected to be keeping a robust growth as well.Carl says that at a time of economic boom, the property sector is one of those that benefit the most. As incomes rise, he says, demand for properties grows as well.Given this backdrop, he says, business-minded individuals should easily see the income opportunity over the medium to long term from investing in real properties.“Stars are aligned right now. Because of the economic boom in Asia, the benefits are trickling down to the Philippines. Almost all sectors are enjoying good business, and the property sector is not exempted,” Carl says.(click here to read full article)
It is easy in a sense that one you have purchased and have cleared the papers you really don’t have to check it on a day t day basis(in the case of a parcel of land) or even have an operating capital to run it. Maintenance will be spent on as needed basis and you really don’t need to employ people to look over or run it. It is difficult to handle because property is a tricky investment. You may have bought a very cheap property but the surrounding neighbors might not be as friendly or as peaceful thus you will surely have a difficult time to sell it or if you will be renting it out you will have a hard time looking for tenants.
Besides such, property valuation differs from time to time (I guess except for land which should be in an upward direction only). For condo in the urban areas at times prices might go up due to the boom or at times it could be down because nobody is buying or everyone is on tight finances. At times changes in traffic or if the area got flooded people who where thinking of buying a property might change their mind and in the end if everyone has a notion of that area being prone to flooding of course the value of the property will also go down in order to sell it.
But above all remember this, such real estate or property only becomes an investment if you derived profit or income from it.
This is a common mistake on us Pinoys that having a dream house is an investment: it is not.
An investment should always be a profit generating profit asset which could happen in a short or long term. Real Estate is on the long term side. It is common to hear among employees that they have made or they have fully paid their investment which is the very house they live in. If I ask you would that house where you live in bring food in your table? Of course not.
Thus we should always have that clear idea of what is an investment and what is just a house which we call home. Thus buy assets to be rented out in order to reap income form it thus we can call it an investment.
Right now it is the best time because of the low borrowing rate we enjoy at the same time enough jobs are available to the young professionals and thus the buying capacity is there. Always remember though what Carl they mentioned about buying a real property investment: cheap does not necessarily translate to good investment, you still have to do lots of learning and investigation when buying a property.