It is no secret that investing in the real estate market is a great way to earn a significant amount of money. Investing in residential property is becoming more and more popular these days as an ideal way to establish positive cash flow. Investing in residential properties is considered a viable option for a number of reasons, including:
• Residential properties can create immense profits.
• Residential properties provide slow profits, but that profit is a steady flow of cash.
Experts in the real estate industry feel that investing in residential properties creates a steady boom that can lead to considerable capital.
Types of Residential Properties
There are three different types of residential properties available for property investment and each one has its own potential benefits and risks.
Private homes are individual properties on an individual plot of land. The value of the private home is generally on the high side because of the privacy and space that they provide to the residents. However, because of the higher price tag, private homes are often on the market for extended periods of time and remain unoccupied longer than multi-unit housing.
In addition, there is no way for you to guarantee that the value of the house will not quickly depreciate because of occupant neglect. Often times, there are only so many hours a landlord can spend on a property, especially if he or she is trying to manage more than one investment property.
Another type of residential investment property is condominiums. With condos, the houses are individually owned and the internal roads and exterior areas are commonly owned. Generally, the value of a condominium is less than the value of a privately owned property. In addition, condominiums are governed by a series of bylaws and agreements that are signed by every resident. With proper governance, the value of the property may increase. Likewise, if the governance is not up to par, the value of the condominium may decrease.
The third type of residential investment property is multi-family housing, which is several units inside a single building, such as apartment buildings. The greatest benefit to multi-family properties is that it can be completely uninhabited, completely inhabited or a combination of both. With multi-family housing, you stand a greater chance of maintaining a steady monthly cash flow.
Property Options Australia
Property Options Blog © 2006 – 2010
Tags: Investment, Property Investment, real estate market, residential investment property
{ 4 comments… read them below or add one }
it is convenient to live in a Condominium if you are in a big city but i like big lawns and backyard gardens.-.:
i kind of don’t like to live in condominums because they don’t offer large spaces for garden.*’-
Hi Sean,
I like private homes as my preferred choice of residential investment property. But I’d be willing to consider apartment buildings as a secondary property investment.
They all offer different opportunities for making a profit. I guess your choice would really depend on your financial goals.
It seems alittle like monopoly…the hotels pay more! I like the idea of units as long as the body corporate fees are not to high.