Profit Property Investment

Property investment is one type of investment that promises big returns. It can be seen from the property prices that always rise every year.

For those of you who have unemployed funds, immediately invest in property from an early age. The more delay, the more expensive property prices. Finally, it becomes increasingly difficult to catch up with these increases and makes you lose property investment opportunities.

Understanding Property Investment?

Property investment is the purchase of property or real estate with the aim of making a profit through rental business activities, future resale of property, or both. So, it is not purchased as the residence of the buyer.

Property investment can be owned by individuals or institutions or business entities. Property investment can include long term or short term investment.

Property investment is often called a second home. The first house is to live in, the second house is an investment.

But not all use that way. It is also possible for someone to buy a second home, for example a villa in a tourist destination as a place to stay when on vacation in that area.

In other words, it's not a property investment. But for personal gain. Property is not used as a source of income.

Property Investment Advantages

Here are the advantages of property investment that will make you smitten:

1. As Passive Income

Property investment is the right way to print passive income. Income earned just by sitting pretty or while lying down at home.

Money enters the account in the form of rental income, dividends, interest, and even royalties from property investment results. Delicious right? It is suitable for retirement or old age preparations.

2. Prices tend to rise, big money

Property investment is known as low risk investment. That's because the property market is not as volatile as the stock market.

The proof is the increase in property prices on average 10-20% per year. Even if it goes down, the reversal is fast, so you can make big profits.

3. Not Undermined Inflation

Looking at property prices which tend to increase by a percentage of 10-20% every year, this means far beyond the inflation rate. Inflation in Indonesia averages 3-5% per year.

4. You Set the Price

You are an investor or property owner. Like what price or rate you want to set when selling or renting a property. Control is in your hands.

5. No need to be monitored every day

Investments in stocks and mutual funds need to be monitored at all times. But not with property investment. You just buy a property, then rent or sell it. You can make a profit right away.

No need to monitor every day, because your assets will not be lost. Apart from that, the tenant will take care of your assets. If you want control, you can occasionally.

6. Can Be Used As Collateral

The property you buy can be used as collateral or collateral when you need a bank loan. Maybe you need additional capital to increase investment or during an emergency.

Property Investment Losses

Investment in property also has disadvantages or drawbacks, including:

1. Need Big Capital

Conventional or offline property investment is a capital-intensive investment. This means that this investment requires a large enough capital. Property prices start from hundreds of millions to billions, even trillions of rupiah. up to it?

2. Disaster-Prone So Need Protection

Property investment is quite vulnerable when a disaster occurs, such as the risk of floods, fires, earthquakes, and other risks. You have to cover this risk with property insurance.

That means, you need to spend more to pay the premium every month to get property insurance benefits.

3. Hard to Sell Fast

Property investment is a type of investment that is not liquid or cannot be liquidated at any time. It takes quite a while to sell or pawn it. Not like stocks or mutual funds.

Not to mention if the location of property ownership is not strategic, it is very difficult to resell it or there are not enough people interested. It may take months or even years.

 

Example of Property Investment

Property investment is actually divided into several types. There are residential, commercial, and mixed properties (commercial and residential).

The following are examples of property investments by type:

1. Home

2. Apartment

3. Townhouses

4. Shophouse

5. Office

6. Hotel condotel or condo

7. Soil

8. Villa

9. Warehouse.

How to Invest Property

Property investment needs to be done properly and correctly so that it can run smoothly, and obtain maximum results. Here are three ways to invest in property that you can try:

1. Online Property Investment

Property investment has now penetrated online. This means that investors do not only have to buy property with wads of money.

This is how to invest in small capital properties. Trusted online property investment through special platforms or applications registered with OJK. Online property investment can be done in the following ways:

• Property equity crowdfunding

Property equity crowdfunding is joint property investment with other investors on platforms or applications that provide these services. This is a cheap online property investment because you don't need big capital like buying an offline property.

For example, you want to invest in property by buying a house for IDR 1 billion. Just invest 1% of the property price or IDR 10 million. The rest of the investment will come from other investors. Cheap right?

• P2P Lending property investment

Another way to invest in property for beginners is to conduct P2P lending funding or investment, especially for investment projects. This platform connects developers with the community.

You can become a lender with a minimum investment starting from IDR 100,000. Profits or returns earned up to 20% per year.

• Buying shares of property issuers

The next way to invest in online property is to buy shares of property issuers. Investment in shares in the property sector can currently be done online through an online stock trading application owned by a securities company.

Small capital online stock investment. Starting from IDR 100 thousand. Apart from buying stocks, you can also sell stocks and do analysis through the stock chart features provided.

2. Property Investment Rental System

Property investment by leasing assets is the most popular way to increase income. You can buy properties, such as houses, apartments, condos, townhouses, then rent them out for residence.

Or buy office property, shop houses, retail shops and rent them out for business or commercial purposes. From the results of the rental, you get monthly or annual rent.

3. Flipping Property Investment

Flipping property investment is buying a property at a lower price than the market. Furthermore, renovations were carried out and then sold at a much more expensive price.

This technique or strategy is called flipping. The perpetrator or person doing the flipping is called a flipper. For example, buying a used house for IDR 100 million. Then renovated, and sold the house for Rp. 500 million.

This type of property investment model can be called a short-term investment. Because, the process is fast, buying a house, renovating, and selling it to make a profit in a short time. Really profitable property investment.

10 Ways of the Safest Property Investment 

1. Find the Property Type

Properties come in various types. It's best to specify what type you want. Is it a house, apartment, shop, or vacant land? This is because each type of property has its advantages and disadvantages.

For example, between a house and vacant land, the price of the house can be ascertained to be more expensive because it is already finished and can be occupied immediately. We recommend that you adjust it to your long-term needs so you don't choose the wrong one, OK!

2. Pay attention to the location

Location is crucial when choosing a property. Choose one that is in a strategic location so that it is easily accessible to many people. If the budget isn't enough, you can look at locations that are a bit on the outskirts of town as long as you have good access.

Believe it or not, even locations on the outskirts of the city will be crowded. This automatically makes the property price more expensive.

3. Prepare Capital

Apart from the location, you also need to prepare enough capital to buy a property unit. Not only the basic costs, but there are also other costs that should not be missed from the calculation.

These costs include down payments (DP), booking fees, and monthly installment fees for the KPR payment method. Considering that the amount is not small, it is important for you to save from now on so that your desire to own a house can be fulfilled.

4. Pay Attention to Developer Credibility

Who is the developer in charge of the build? What is the project history like? Has there ever been a building that was in a state of disrepair or was everything successfully completed?

The questions above must be taken into consideration when choosing a developer. Choose a credible developer so you don't feel disappointed after the building is finished. Because, you can be sure that the results are in accordance with the concept that the developer determined at the beginning of the project.

5. Check Complete Facilities

For apartment and boarding house type properties, it is important to check the completeness of the facilities, especially if you want to rent them out. Properties that have complete facilities are in great demand because they make residents feel pampered. On the other hand, residents also save money because they don't need to spend an additional budget to add facilities to the residence.

It's okay if you want to increase the rental fee because you have provided complete facilities. Any occupants would accept, as long as the increase is not too significant.

6. Request a Brochure

If you want to invest in property, it's best to ask for a brochure every time you go to an exhibition or come to the marketing office from a developer. This brochure is a complete source of information regarding the types of properties that are being traded by developers.

Also from brochures, you can more easily compare properties from different developers. So, there is no need to go back and forth to the location to inquire about the property because everything has been written in the brochure.

7. Apply for a mortgage immediately

Found a suitable property, but not enough savings to buy cash? Take it easy, there is a mortgage ready to help. You can immediately apply for a mortgage to one of the banks in Indonesia by bringing the required documents.

Mortgage applications can be rejected, can be accepted. The chances of being accepted are greater if you have never had bad credit and are in a decent financial condition. In a sense, the salary meets the requirements set by the bank.

8. Prepare Sufficient Cash

Don't just rely on mortgages, OK? However, there must be cash prepared when buying a property, because there are additional costs for each purchase.

These additional costs include insurance, notary fees, bank fees, and taxes. This cost can't possibly be covered by the mortgage too, right?

9. Determine the Payment Tenor

When applying for a mortgage, you are asked to determine the loan payment tenor. The ideal is 5-10 years, but you have to adjust it again with financial capabilities.

If you feel you can afford to pay installments in a shorter period of time, why not? The shorter the payment tenor, the better. After the installments are finished, you can focus on investing in other instruments that are no less lucrative.

10. Monthly Expense Control

If the property is purchased with a mortgage, the expense item will automatically increase. At that time too, the monthly budget must be repaired immediately so that the salary is sufficient to meet the needs.

Carry out expenditure controls as tightly as possible to avoid spending outside the budget. This is important to maintain financial stability as long as the installments have not been paid off.

Understand that Property Investment Profits

Property investment is not impossible for those of you who have a mediocre salary. Anyone can have the opportunity to invest in property without capital or small capital.

The key is learning. Learn to understand the ins and outs of property investment and the right buying and selling strategy, so you don't make mistakes that make you stumped.