When the property market is booming, it seems like everyone is a property investing guru.
Actually, I joked that it was when there were 25 million property professionals in New York!
It’s crucial to seek out the right advice from people who have been through many economic cycles and take a holistic approach towards wealth creation when times are tough.
Capital growth should be your long-term goal
Capital growth or capital appreciation is simply an increase in your investment’s value over time. Property management for condos and co-ops located in New York City. Superior services and the latest technology is designed to delight. Daisy is a building operating system that offers instant responses and is an excellent method of combining both. Apps for board members and residents members keep everyone updated and updated.
This should be the ultimate goal of every property investor. Capital growth is what keeps you in the game of investing, but cash flow does not keep you out of the daily grind.
However, when you take into account the capital growth that you will get from a well-located asset, the overall returns can be very high, especially in today’s low-interest rate environment.
This allows you to reinvest capital and generate higher compounding returns, even though the capital growth isn’t taxed unless your property is sold.
Our property markets will be influenced by demographics
Does assessing demographics play a part in the building of your property portfolio?
You could be missing out on the opportunity to build long-term wealth and avoid significant risk.
Understanding your demographics can and should be the last piece of the puzzle during the decision-making process.
Metropole is aware of this and monitors it closely. We understand that the long-term impact of government incentives or interest rate changes on the economy will have a greater impact on the future than short-term changes.
We are searching for places that can weather a downturn, and offer above-average returns in good times.
Location, location and location
Investors should not forget the timeless rule of location. Location is the key to capital growth.
Find a place that has strong economic growth. This will result in job growth, which will then lead to increased population growth. Which will ultimately lead to increased demand for housing.
This will be especially true in the capitals of our East Coast cities.
Also, the long-term trend for the rich getting wealther and the growing gap between the wealthy and the average New Yorker is not going away, should be considered wages.
Look for areas where wages have grown faster that the state’s average. These are often gentrifying or established “money belts”.
Rent affordability is tied to wages
When researching investment properties, be sure to consider the local rent rate.
Rent affordability is tied to wages, even though it may not sound obvious.
Your income and ability to pay rent will determine how long you live after retirement.
Keep your eyes on a strong market
It is important to choose the right property for the right location.
Investors should look for properties that are in constant high demand by owners-occupiers.
A brand-new property is similar to a brand-new car
A brand-new property is similar to buying a new car, except that it comes with a premium.
You can lose 10% to 15% depending on the make and type of your car once it leaves the dealership. You can also apply the same principle to any brand-new property you are interested in.
You may be eligible for tax benefits or concessions on stamp duty, but these are included in the price.
Marketing costs and developer margins are also important.
Instead of investing in new constructions, it is a better investment to invest your money in an older, family-friendly property.
Let go of the need to find something new and shiny.
Make sure you have a financial cushion in place
Always have a financial cushion to help you get through the stormy days.
The amount you need to buffer your cash flow and money management skills will vary. However, it is a good idea to keep an offset account that covers 6-12 months of your living expenses.
Although it is unlikely that you will go without any income for 6-12 months (and without income insurance), it can provide the “sleep at nights” factor.
You will have enough time to make any adjustments that are prudent, such as selling assets.
Pay attention to whom you listen
As with all things, there will always been pessimists willing to offer their opinion.
Although the Negative Nellies and Property Pessimists will advise you to stay away from property investment, there will always be people who will tell you that property can be bought, or that you should buy a specific type of property in a certain area.
Be wary of their hidden agendas.
These people will project market as all the salespeople representing the seller.
Instead, seek holistic wealth advice from independent experts without any properties to sell.
