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There are all manner of reasons to invest in property. It’s still one of the most valuable assets you can own, especially because housing supply is becoming more competitive. But if you invest in a property, there are also many different ways to earn passive income on it. Rising values are just one of these options, as renting the property out through various categories, using it for commercial purposes, or even purchasing just for the plot of land can be valuable in some circumstances.

In fact, the reasoning for investing in one plot over another can be as vast and varied as the houses available on the market, even if prices have risen quite dramatically over the last twenty years (not accounting for the housing crash).

As this is still a big investment, even if you were planning to become a first-time landlord for example, you may still be reticent. In this post, we’ll discuss when it’s wisest to invest in property of this nature, and how you may wish to go about it:

An Opportunistic Deal

It’s easy to see the right property comes along at the wrong time, or what feels like the wrong time that puts you out a little. There are many circumstances in which this happens, as maybe a motivated seller needs to offload something quickly, or there’s a foreclosure that’s been sitting on the market because it needs work. Taking advantage of them does mean you’re getting something below market value, but you need to be ready to act.

In such cases, ensuring your finances line up will help you move quickly. If you’re waiting around for mortgage approval or trying to scrape together a deposit, someone else could snap it up. We often see options like bridging loans for commercial property are popular in such instances, because they let you secure the deal now and sort out the longer-term financing later.

Renovation Potential

A property that looks rough can scare off most buyers, which is exactly why it might be worth your attention if you have vision for it. It’s tough to do this, but if you can see past peeling wallpaper and outdated kitchens to what the place could become, you’re already ahead. Renovation projects take time and money, but if the payoff means more equity and grounded profit that can be helpful.

Moreover, you can still be a little hands-off if you factor in the cost of contractors and project management. Projections aren’t perfect but with experience may come the tacit courage to make it work, and if the projected numbers make sense and you’ve got the patience for it, a fixer-upper can be one of the better ways to build equity quickly.

When Financial Wriggle Room Is Present

Investing in property shouldn’t stretch you so thin that one bad month puts you in trouble, and if it does, it’s best to steer clear of this for now. Ultimately, you need some cushion for costs, periods when the property sits empty, or repairs that absolutely will come and at the least convenient times, too. If you’re barely scraping by to cover the mortgage, it’s probably not the right time yet.

It’s also easier to make smart decisions about the property when you’re not desperate for cash flow. If you’ve got savings set aside and your other finances are stable maybe an investment you’ve ignored before could be a wise place to put your savings now.

With this advice, we hope you can more easily decide teh right time for investment property.