Property investment is one of the best long-term investments that can be made. Property investment is the act of buying real estate with the aim of getting a return on investment (ROI) when renting out the property, selling the property or both.
5 Types of Profitable Property Investment!
1. Cost House
A boarding house is a property investment that can be very profitable if managed properly. This is because the need for boarding houses is very high especially in urban areas, both for students or for workers who are looking for a place to live to be closer to their office or campus.
2. Rented House
Apart from boarding houses, rented houses can also bring benefits when managed properly. Although boarding houses and rented houses have the same purpose, namely as temporary residences, rented houses are more sought after by families who cannot afford a permanent house or will only live in the area temporarily.
3. Shophouse
Shophouses or shop houses are multi-storey buildings where the upper floor can be used as a residence and the lower floor is used as a place of business or office. Besides being profitable because it can be rented out, based on the place and the price can tend to go up every year.
Even during the pandemic, the demand for shophouse rentals fell, there are a few tricks you can do to process your shophouse investment. An example is changing the terms of the lease where usually you have to rent 4 floors to 1 floor. It could also be by turning the shop-house into a food court, where several restaurants or canteens sell, or it could be by turning the shop-house into a boarding house.
4. Land
Land is one of the property investments that are in great demand by the public. This is because the value of inflation causes a far increase in prices, especially in big cities. Land investment can be done by looking for locations that have the potential to become crowded places and can also be rented out to those who need land.
5. Apartment
Property investment is also growing in popularity due to increasingly expensive landed houses and less land. Apartments are popular, especially among families and the younger generation because they are cheaper than houses and come with various facilities that can be used.
Let's focus on property investment for apartments and houses. Both property investments are suitable to live in, but which one is more suitable for you? Come on, know the advantages and disadvantages of investing in apartments and houses.
Apartment Investment
Advantages of Apartment Investment
- It has a lower price than a house.
- Get complete facilities such as a swimming pool, private gym , etc.
- Unit rental prices are usually higher when rented out to expatriates.
- Usually located in a strategic location with easy access and modern facilities.
- The longer the quality - the demand .
- Sold with layout , so it cannot be changed except with the permission of the manager.
- The value is below the house when used for a credit guarantee.
- The apartment area is smaller than the house.
- Can get problems caused by other units, such as pipe leaks.
- Routine costs that can be higher than home routine costs.
Home Investment
Advantages of Home Investment
- Investing in a home will be easier when you want to sell it again.
- If the house has a good building, if you want to rent it, you can get a higher price.
- Compared to apartments, rising house prices are more common.
- It is easier to be used as a credit guarantee by a bank.
Disadvantages of Home Investment
- Prices are more expensive than apartments.
- Buildings must be frequently maintained and renovated because buildings experience depreciation that can reach 10 percent per year. By maintaining and renovating house buildings, the quality of the house is maintained and the selling value does not decrease.
- Need home insurance just in case.
- Need to pay environmental fee for cleanliness and safety.
- If the house is renting out, be sure to check the background of the tenant and whether they are responsible. This is to maintain the condition of the house so that it is not damaged or neglected when rented out.