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Key Points to Consider while Investing in Real Estate

22/02/2021

Key Points to Consider while Investing in Real Estate

Being a cash-backed investment option, Pakistan real estate always offers attractive and stable rental yields in the world. And investing in a rental property in Pakistan can be a great way to start generating steady income and build wealth over time but getting started can be intimidating. A newbie investor must be scared of taking his first step but there are several factors that must be considered in order to ensure that you yield maximum Return on Investment (ROI).

Being a cash-backed investment option, Pakistan real estate always offers attractive and stable rental yields in the world. And investing in a rental property in Pakistan can be a great way to start generating steady income and build wealth over time but getting started can be intimidating. A newbie investor must be scared of taking his first step but there are several factors that must be considered in order to ensure that you yield maximum Return on Investment (ROI).

Why invest in Pakistan real estate sector?

One of the biggest reason to invest in rental properties in Pakistan is that this sector offers steady and relatively stable rental yields. Moreover, investing in major cities across Pakistan such as Lahore, Islamabad, Karachi and Faisalabad offers higher rental yields than smaller cities. And compared to international market, the property prices in Pakistan are lower – making Pakistan an affordable location to own a premium piece of property even such as; Eighteen Islamabad, DHA Lahore or Bahria Town Karachi.

What to consider while investing in a rental property?

Stable and positive return on investment (ROI) is the ultimate goal of investment in real estate. Therefore, it is good to secure a property that delivers positive rates of return requires proper due diligence from the beginning. Few important points are as follows:

What and where to buy?

Before going any further into the process, it is a smart idea to be transparent about your investment goals. For instance, do you want to invest in an apartment or want a house? Are you looking to invest in premium investment property or a low-maintenance, average property? You can definitely get more rental income from a premium investment property in posh areas but an average property needs less cash, needs lower maintenance and can be easily rented out.

Location is also an important factor so you must set your search parameters in a certain neighbourhood or be flexible about it. For instance, if you are looking for a rental property that can yield a strong return on investment (ROI) for you, then you must pick the best performing areas in the city but can limit your search by finding a house near school, as you consider it that such property will be in higher demand, due to its proximity to school.

Market conditions

There are shifts in realty market like every other sector so, try to invest when the market is in favour of buyers. If you tend to work with a pro investor or an experienced real estate agent, they will help you get first-hand information. Certainly, no one can assure you about positive and steady returns but from their experience, they can guide you as how did they start this venture, where did they invest and what should they consider before investment. Build a team of experts around you and get in touch with them and collect bit of information from everyone around. It will help you assess your investment plan and weigh it against these pointers and help you make a profitable investment decision.

Tips for achieving positive ROI

If analysing the Pakistan realty market, it is found that apartment developments have become new hype, so they are expected to provide stronger and positive rental yields in near future as compared to premium villas and bigger multi-unit homes. It is because maximum population belongs to low to mid-income strata with a budget leads to affordable rental residences.

Therefore, real estate experts would suggest you to invest in new apartments or smaller sized homes in reasonably well-performing residential communities. All you need to consider is that rental property is in good condition, located in a community with established infrastructure, have multiple transportation options and necessary amenities are in close proximity such as hospitals and schools.

Another important consideration that favours investing in smaller units is that resale of smaller units is faster and they tend to offer better returns (if you plan to sell these properties ahead) as compared to premium properties spread over kanals.

When it comes to investing in real estate, seeing the budget bracket, real estate experts may suggest you to go for off-plan properties. It is because off-plan properties are priced significantly less than ready properties. However, the biggest disadvantage of buying an off-plan property is delay in the handing over after the scheduled time. If you are still willing to invest in an off-plan property, it is crucial to check the property developer’s repute and conduct an independent research to verify their track record of delivering the previous projects. It will help you take a better and well-informed investment decision.

Do you know that the best time to invest in real estate is already yesterday? Re-evaluate your investment plans and keep checking on the number of properties available in the market and choose the one that serve your investment plans. If you are looking to invest in properties in Pakistan and achieve strong rental yields in near future, look no further. Run a search on www.homespakistan.com and see a plethora of options that fall in your budget bracket.

You can also write us at contact@homespakistan.com to discuss your investment plans or to know more about available options. Our experts will love to hear from you and guide you in the right direction. Do not forget to check our Facebook page to stay updated about Pakistan realty sector and market happenings.

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