Someone once said; ‘it is not about getting rich, it is about creating wealth instead’. Wealth creation saves you from financial crisis in the nearest future. One best way to create wealth is through investment and one lucrative form of investment is investment in real estate.
Basically, real estates are properties consisting of lands and buildings on it, with its natural resources such as crops, minerals, waters and immovable property of this nature. You will agree with me that the land bought at price X last ten years is now sold at a doubled price. This shows how profitable real estate could be. Little wonder it is becoming more popular these days. Many have taken up the business as individual agent while some have expanded their capacity by making it a business or a company and we can say for sure that it is one profitable business or investment that you could venture in. Real estate agents and Real Estate companies are making money in Nigeria and here are some things you should know about real estate investments
HOW THE MARKET WORKS
One common feature of real estate is that it appreciates over time. However, there is a market for real estate and it operates just like any other market. The market is driven by the supply and demand of real estates.
The supply and demand of real estates are actually driven by some certain factors. For example, the location could be a factor, demand for office buildings will be on high demand in a corporate area, farms will be on high demand in local areas and this will affect price in return. Transportation could be another factor, areas with good transportation facilities such as good roads will be on high demand than roads father away and this will definitely affect price as the former will be priced higher than the later
REAL ESTATE AGENT & REAL ESTATE INVESTOR
You can either invest as a real estate investor or as a real estate agent. These days, a real estate investor has to go through a real estate agent. A real estate investor is the one who puts the capital in return for a real estate. As a real estate investor with little capital, you can collaborate with others to raise up the capital through loans or any other legal means, buy the land and when it appreciates in value, you resell the land and payback the loan.
As a real estate agent on the other hand, you don’t need to put down your personal money to invest except you want to be an investor. You can be an agent as you connect those who want to sell their lands and those who want to buy while you receive a percentage or a commission. This sounds like a lucrative business. Imagine, you gain 10% on every job you bring; a sure way to get extra cash.
YOUR RESEARCH SKILLS IS NEEDED
Investment in real estate is not just any investment you wake up in the morning and decide to do. It takes a lot of research. There are a lot of questions you need to ask and a lot of things you need to know. You need to ask yourself this questions; What kind of location are you looking into? What sort of real estate are you venturing into; office spaces, homes for rent? Does your proposed area have a bad history like flooding? You should also be able to know which area has the prospects of being in high demand so as to make profits gains
NEGOTIATION SKILLS ARE ALSO REQUIRED
One skill you need to have as someone into real estate business is the negotiation skill. The real estate market is just like any market where you buy and sell commodities, real estates in this case.
In every transaction you make, always remember you can always buy at a lesser price or sell at a higher price. One skill that drives a successful real estate investor or a real estate agent is his/her ability to negotiate. Never be in a hurry to agree with the price, negotiate instead. Checking out the prices of real estates in that location could help you to negotiate better.
LEGAL BACKING
It is no longer news that scams are almost everywhere. It is therefore important to have a legal backing for every deal you make and make sure everything you do is put in a signed document and you having a personal copy and leaving it with your lawyer. There are a lot of people who want to take advantage of every opportunity and trust me, you do not want to fall in the hands of scammers.
BENEFITS
There are quite a number of benefits of investing in real estate in case you are still in doubt; it is one way to get an extra income even while you’re working and even during retirement. Also, the value of real estate appreciates over time and could help to diversify your investment portfolio
