Money management is not everyone’s cup of tea. You may feel that investing your money in stocks might be worth taking a chance, while others may consider real estate to be the best for the return on investment. Besides, real estate investment is relatively easy and safe. However, the question is how much you should invest.
 
Two things that you must consider about real estate investment is that it is immovable and it is a long-term investment. With time, property value increases. One thing you should keep in mind that property is not considered as liquid property because it is challenging to get the benefit of selling in short duration. Also, it is not easy to sell property quickly. You need to park some money for maintenance of the property as well. Consider property tax and utilities also. Above all, sometimes developers do not give possession of the property on time. Therefore, you might end up paying more than expected.
 
Many of us buy a rental property with a thought of getting an immediate return of investment. However, there may be the case that the property goes without renting for a while. In such a scenario, you will have to bear the cost of EMI every month until the property is rented out. Besides, the rent amount may not match the EMI amount. Also, the maintenance cost of rented property can be relatively high. Additional cost such as real estate agent fee and property insurance to be considered as well.
 
If you are planning to invest in land thinking that you can sell it later for a profit, then read the deeds carefully before you buy. Check if there is any plan for road construction near the land and how it would affect the property. Check the neighbourhood, if it is an upcoming area for growth and suburbanisation. After all these research you may be able to decide on the investment. Other factors to consider as a form of investment is that you may have to build fences for protection and demarcation. Always check whether it is a land of dispute; in such investment, it may take years to recover money if investment. It may be a bad investment.
 
Always start small, set up a budget. Based on this, you make your investment for maximum return and hassle-free investment. Even after all these precautions, there might be a chance of error. So, always have a buffer liquid amount handy.
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