Have you ever wondered if real estate is a sound investment? Well, it certainly can be! There are people out there who have invested in real estate and created a very comfortable lifestyle for themselves. That being said, there are also people out there who have lost everything due to bad real estate investments. When it comes to investing in real estate, especially for retirement purposes, it takes quite a bit of knowledge, skill, intuition and guts. Here are some tips to consider when it comes to investing in property for retirement income:
1. Make sure to increase your real estate knowledge
It goes without saying that to be good at anything, you need to know what you are doing. There are many seminars that you can attend that focus on how to invest in real estate. You can also read books on the matter and with the internet, all this information is readily available to you.
2. Make sure to polish your skills
There are many ways to invest in real estate. You can purchase a home or piece of land that you can flip, or a home that you can remodel and sell at a higher price. Otherwise, if you are looking to generate an income that can be used for retirement, you can look for income-producing properties such as commercial office spaces, apartments or homes that can be rented out. It’s important to assess your skills before purchasing a property. For example, if you have close ties to the development plans of your area, you could have a knack for spotting pieces of land that will increase in value over time and if you know contractors, you could be able to get remodels done at a discounted price.
3. Make sure to develop your intuition
Have you ever heard the real estate saying, “Location, location, location”? Well, this saying is very true. You need to have some intuition as to what areas will become popular over time, and what areas will deteriorate over time. We recommend avoiding buying property in areas that you are not familiar with.
4. Have the guts to take the leap
When it comes to investing in property, you need guts because there will be taxes to pay and there will be times where your rental properties are left unoccupied. Just because your rental property is vacant, doesn’t mean that you don’t still have a mortgage, repairs and maintenance costs to pay. That is why it is so important to choose the right property to invest in. Flipping properties will take guts too. Because the property might not sell as quickly as anticipated, that is when you need to have the guts to hang on or the guts to sell the property at a lower price.
The takeaway here is that real estate can be an excellent investment and can generate a great source of income while you are enjoying your golden years. However, you must go about it in the right way. If you are planning on using real estate to build a source of retirement income, make sure to be patient and work systematically as you build a portfolio of income-producing properties. Never jump the gun, do your research and make the right decisions, this way you can enter retirement with peace of mind.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).