Naples Real Estate Investment Very Profitable
A real estate investment can be very lucrative if you make a good purchase, and properly manage your investment. You can generate good profits. But it is not as easy as those TV infomercial like to make out. You should call us to help you find a property that will generate profits.
- Requires in-depth knowledge of the local real estate market to choose a suitable property for a real estate investment.
- Requires sufficient capital to purchase a property, or pay a down payment on a mortgage.
- Requires finding a tenant paying sufficient rent to cover your monthly expenses (mortgage, taxes, normal wear and tear repairs, insurance)
- Requires backup funds to cover unexpected property repairs (insurance deductible after storm damage)
- Requires funds to cover non-payment of rent while evicting a tenant
- Requires funds to pay for an attorney to evict a tenant.
- Requires property values to increase while you hold the property
- Requires that you sell the property for a higher amount than you bought it.
- Requires that you pay a realtor 6% of the selling price when you sell the property.
- Requires that you pay capital gains tax on your profit.
However, don’t be dismayed. If you have the funds to cover your expenses and you invest in a town like Naples and hookup with good realtor, you can’t go wrong with a real estate investment. Aside from the year 2008 when all America went belly up, the property values in Naples have steadily increased. Values of properties are almost back where they were before 2008.
If you are faint hearted but you know that properties values have, and always will increase over time, you can always invest in Real Estate Investment Trusts (REITs). Buying shares in a real estate investment trust is pretty safe way to invest. It’s not as liquid an investment as the stock market, but as times it handily out-performs the stock market. Just remember, real estate markets are often cyclical. Luckily for you, in Naples we are in a soaring real estate cycle now.
Direct Investing In Real Estate
Now that we’ve dealt with the downsides and alternative real estate investment, let’s be practical and a little more optimistic of directly purchasing a property as an investment. What kind of expertise do have in management, selling, real estate business, real estate law, construction, maintenance or any other business?
If you are going to manage the property, make sure you understand what it’s like to handle tenants. You’re going to get calls late Sunday night telling you ” there’s no a/c, the roof is leaking, etc”.
We who are considering becoming landlords should ask ourselves, before deciding to act, whether we can stomach the job of dealing with upset tenants or downright ornery tenants. Most people are not equipped mentally to deal with the day to day problems of managing tenants and keeping investment property well maintained. If you feel that way, hire a property management company.
Location is always imprtant but not as important as he who dreamed up the slogan “location, lovation, location”. You will not find the best property within your price range if you don’t have local knowledge or sue professional help. The value of any piece of real estate is calculated based on the local economy, location, square feet, condition, landscaping, roof, construction, monthly operating costs, neighbors, property taxes, utility costs and a few other esoteric values known only to professionals.
For residences, the health of the local economy is very important. For familes with children, the school district and nearest school are imortant.
Commercial Property
Commercial property is particularly difficult to evaluate. A thorough investigation is highly recommended before purchasing a commercial property. Commercial leases are usually multi-year contracts. You’ll be taking on existing tenants, therefore you’ll want to do some research on those tenants.
Conclusions
If you decide to go ahead with the acquisition of a piece of investment real estate, get professional advice from realtors like us. The advice is FREE. We will gladly point you in the right direction. Of course, we have the hope that you’ll choose a property that we have listed, but that’s our job! We spend days, weeks and months assisting people to find property and more often that not we don’t get any financial reward. But at least we get the pleasure of knowing we helped many buyers to avoid some pitfalls.
We’ll help you. You should call us now to help you with your real estate investment.
