Real Estate Investments 101: A Guide to New Investors


Knowing your way around the real estate industry is a must before going all-in with investments. There is always a risk to investing and it helps to be properly informed and educated.

Why Invest in Real Estate

First off, why do people want to invest in real estate given that the entry barrier is quite expensive? There are several reasons people invest in real estate properties.

One common reason is property ownership. If you need a place you can call home, you can rent or you can buy a house. The difference between the two is that renting will not give you the ownership of the place you are paying for. Eventually you will have to move out.

Buying a house or a condominium means that the ownership will be transferred to you. You won’t have to worry about wasting money on rent since the monthly payments will be because you already own your home.

Another common reason is generating income. Should you be lucky to buy a huge property, you can use it to add another source of income. For instance, you can get a huge apartment that you can rent out to several tenants to get more positive cash flow going.

A condo and/or resthouse is also usually used to target both local and international tourists. You can use a variety of services geared towards booking services. AirBnB is the most popular booking service for all types of homes.

Essentially, all of those renters will be paying for your monthly payments for the home that you want.

Having your own place also has its own advantages. You will be able to relax more and enjoy the privacy. If you bought your place near your work, then you will be able to commute or drive faster, which can turn into more savings and more money for you.

Money out of Property 

Real Estate Appreciation

Unlike your usual gadgets and automobiles, real estate property values mostly go up during the course of time. This is especially true for properties that are located in prime places such as those around Metro Manila.

The busier the place is, the more expensive the properties tend to be. If you are not living in your chosen property, you can sell it for a higher price when the value increases over time.

Real Estate Cash Flow

As mentioned earlier, real estate can also bring you money directly if you invested in more than residential places. If you managed to buy an office building, you can charge your tenants and generate income.

Rental houses, apartment buildings, storage units, and more can bring you huge revenues especially if the demand is high. Urban properties can give you the most income.

Real Estate Ancillary Income

Income can also be sourced from smaller businesses within your property. Tenants that lease spaces from you for their businesses is another type of income. These may also include vending machines and the like.

Before getting into the real estate industry, it is worth noting that you should be guided if you are not an expert on the matter. You may consider approaching property management and consulting firms like Santos Knight Frank, which is one of the leading property experts in the country and across the globe. They can help you make the best decisions about your property and investments.

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