If investors want to buy property includes land on which the building is standing and its value is highly variable. There’s a price equal to the price of building land, or land prices are higher than the price of the building, or land prices are lower than the value of the building. Type of property that can be made into a business, among other houses, shops, warehouses, malls, office buildings, resorts, and apartments. When investors invest in the property must diversify to a small risk and profit. Diversification on the property using the concept of location and type, such as an office, residential, and warehousing.
Place of residence may be established in the middle of a city apartment or condo or in the suburbs. Location should be close to transportation expense for applicants / investors do not have to grow. Managing property as a business or becoming an investment means there is a period when the property “held” and sold. As a business, investors lease property to another party. Generally tenants always wanted a property in strategic locations. Location of the property also determines the amount of rent. The strategic location will result in more expensive rental, lease even obtained almost the same as the interest from funds invested in the property which means investors earn huge profits. When investors choose a strategic location and if the purchase price is very cheap, then the rate of return received is very high.
If the rental value obtained is not equal to the interest rate applicable, then the value of the lease must be at least half the prevailing interest rate. Furthermore, if investors want to invest and collect benefits at a later date, then the property must be strategic and have calculated the price increase during the hold. At the time held, the property must be leased and the rental amount should fit the previous description. If the property is not rented out and wait until it sells, then the low rate of return because the building will be damaged or smaller price. Property will be very well maintained when there is a place that property prices will be higher than the empty forever. In this case, investors must have the calculation of the rise in property prices during the hold.
Formula that can be used, ie the minimum interest rate on deposits plus an intolerable risk to the investor on an investment property. If the interest rate on average over the period held by 8%, then the investor must have an average rate of return higher than the minimum premium of 8% and 4% -6%. To get maximum results in property sales and can give results as expected, then the investor must understand the cycle of the property concerned. Normally, very low property prices when interest rates are very high, the economic situation is not good. Property prices will be high when interest rates low and a high excess funds in banks. The economic situation should be understood by asking the experts discussed the economic and property cycles to property experts who understand economics.
Property investors can be used to fund investments in preparation for school children in the future or even for inheritance. If this strategy is used, then the investor must also take into account the rise in property prices and the prices can already meet the needs of the school. This information is obtained through the research of expert property or property data bank. Thus, in managing the property investor harusmemiliki strategic location information. Information can also be obtained through the mass media and investors also should not forget to check the policies of land and property in the area concerned.