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Property investment mistakes

Property investment mistakes

Investing in real estate is very profitable as it yields high returns. But many people lose money while investing in real estate as they have no experience or knowledge about it. With little information you can make a killing through property investment. Let’s discuss the Property investment mistakes to avoid.

No knowledge of market

Many real estate investors lose money due to the lack of market knowledge. It’s very important to know about the market situation before investing in real estate. When market is booming, it’s time to invest in real estate sector. But when market is crashing, your will lose you money due to declining property prices.

No budget assessment

Many people lose money while investing in real estate as they don’t know the hidden costs. It’s always better to assess your budget properly before making a real estate investment. You should also know about the maintenance cost and taxes. These are the hidden cost and are required to maintain the property.

Bad location

Like good location, there are bad property locations too. Bad location makes the property undesirable and people avoid buying or renting it. Bad location areas are those which have declining economy, high crime rate, high noise pollution and old infrastructure. You should never buy an investment property in these areas as chances are high to lose money.

Bad property

Like bad locations there are bad properties too. A property which is in bad condition is the bad property. Properties which have no modern layout plans or finishes & fixtures are also undesirable. Similarly, very large property is also not ideal for investment as very few people can afford to buy or rent it.

Joint investment

Many people invest in real estate as joint venture or in partnership. Joint ventures do happen but always write down the agreements. When there is no written agreement, disputes arise in cost and profit sharing. Therefore, it’s always recommended to write down agreement if you are investing in partnership.

Get rich quick mindset

Another fatal mistake of real estate investment is to have get rich soon mindset. You should know that real estate investment definitely yields profits but only if you have invested for long time period. Many people, who have invested for few months, mostly lose their money. Therefore it’s highly recommended to invest for at least 4-5 years to get good returns.

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(8) Comments

  1. Hafeez Sohail

    on   said 

    Sir, thanks for reply,
    Sir, I m asking about Alhafeez Garden Phase 2 Canal near Sozu water park jallo Lahare. Please advise for location as they are charged me Rs 650,000 per marla. What is the future of this scheme,
    Regards,

    Reply
    • Hafeez Sohail
      Yes I know about the location. Its good society. Why I have told you that wait for 2-3 months is that NAB is investigating 200 housing schemes in Lahore. If you are in hurry just contact LDA for the legal status of the society.

      Reply
    • Muhammad Azeem Uddin
      FBR has collected the details from all TAX departments about the real estate investment from 2014 to 2017.
      This is what I was discussing that PANAMA CASE DECISION has everlasting impact on real estate sector. If Mian Sb and Niazi sb are questioned about flats, every other person will be questioned. Simple question, ASSET BEYOND MEANS, SOURCE OF INCOME.
      So black money is out from reality sector and huge price collapse is on the way. Now onward no one can buy property with black money. Government just want to end the shadow economy. Without black money property prices will fall as are falling at the moment.
      THE CURRENT NEWS WILL ACCELERATE THE COLLAPSE OF PROPERTY PRICE.

      Reply
  2. Hafeez Sohail

    on   said 

    Sir, Regards Property location, I am just investing 5m plot in Al hafeez Garden Phase 2 Lahore @ 650000/marla cost. please advise me for such investment.

    Reply
    • Hafeez Sohail
      Location is the most important thing that increases or decreases the value of a home / property. AL HAFEEZ Garden has prime location as it is located on Main G.T. Road and near to Quaid E Azam Interchange on Lahore Ring Road. Price is also good. Chances of price fall is less. I you can wait for few more months its better otherwise there as slim chances of price fall in this society due to already affordable prices.

      Reply
  3. Nazish Fatima

    on   said 

    GET RICH QUICK MINDSET:

    sir your words are become true for develop countries but do you think at pakistan this law is applicable ?

    i have seen at karachi that every month their is new price , a flat 800 SQ/FT flat cost was 2013 was 1.8 to 2.2 Million but now it is 5.5 million. and rent is USD 200/ monthly.

    can you imagine this kind of huge return of investment in any kind of business.

    The main reason to decline export is that people think to set up manufacturing unit is just a pains taking problem having to face 12 government organization and to buy home/ flat/ plot is quite higher return and easy of life.

    it is the main causes export is just 20 Billion, and i am seeing it can be reduce further 18 billion. if the real estate sector is being playing like this.

    i am sorry to say that we are now producing GAMBLER,, not hard worker, intelligent businessman who go and sell product abroad.

    Reply
    • Nazish Fatima
      This is the real problem. There is no new industry in Pakistan. Economy is falling apart. Real estate sector is used by mafia the whiten the black money. This has many problems. Prices are abnormal and honest tax payers are forced out of the market. Due to declining home ownership, rents are rising. Hope so that in near future prices will ease and people on the rents will start buying homes again. Black money is being chased this time. Hope good days are ahead for the honest tax payers.

      Reply

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