THINGS YOU NEED TO KNOW BEFORE INVESTING IN REAL ESTATE

An investment in real estate is considered by many as a rock-solid investment to weather the storm of inflation and the uncertainty that pervades other investment options such as investment in stocks. Many have taken advantage of amazing opportunities in the real estate industry to get rich quickly without much knowledge while others do their homework before handing over their finances. When people are knowledgeable in real estate, they will make better and wiser investment decisions.
There are a number of things to consider when investing in real estate for the first time. The property market may seem like a maze-like for first-time investors and they may find it hard to access profitable property that aligns with their financial goals. Nevertheless, a first-time investor that is armed with the necessary information on property investment has nothing to worry about. It is important. For a person with an intention of building a real estate portfolio, there are vital things to consider before investing in real estate. Some of these are captured below:

Property Location and Proximity.
Location is the most critical factor in the profitability of a real estate investment. A good way of measuring property location is to take a long-term view of the rate of the expected development of an area over a specific investment period. For instance, the quiet open landscape now behind a residential building could become a noisy industrial facility, diminishing its value. As an investor, you need to carefully check the ownership of a property and the intended use of the areas in which you plan to invest. One way to gather information about prospects around the property you are considering is to contact registered and verified real estate firms or a public agency that deals with land use and town planning.
Land Documents
As an investor, you need to get acquainted with the statutory land documents that are required for the transfer of land ownership in the real estate space. For example, in Nigeria, the condition and nature of property determine the documents that are required. So you need to find out which documents are required for your specific transaction. Some of the documents required in Nigeria are: Certificate of Occupancy (C Of O), Approved Survey Plan, Land Purchase Receipt, Deed of Assignment, Contract of Sale, Governor’s Consent, Deed of Mortgage, Deed of Gift, Letter of Administration, Assent and so on
Property Pricing and Return on Investment
Residential property pricing or valuations are usually influenced by factors such as nearness to basic amenities, greenery, panoramic views, and neighborhood status of the vicinity while proximity to transport hubs, tax-exempt areas, markets, highways, and warehouses are factors that shape commercial property valuations
In real estate property valuation, a number of methods are employed such as the Income approach which is based on expected cash inflow usually used for rental pricing. The sales comparison method deals with recent comparable sales of properties with similar characteristics most deployed in pricing new and old properties. And cost approach which is based on the cost of the land and construction minus depreciation is used for suitable for new construction.
Real estate investment has the potential to yield two types of returns: Monetary Returns and Sentimental Returns. Monetary return is all about the financial gains your money invested can bring. Investors who invest for money are logical and have their eyes locked on the numbers and will only invest when there the numbers are adding up. They are actively looking out for opportunities to multiply their wealth. Examples of sentimental returns can be those returns in form of having bragging rights, impressive brand perception, gaining access to a community, etc. Investors for sentimental value do not mind if a property comes expensive with no potential for a great cash return. So long as it fulfills an emotional desire. Some investment opportunities coincidentally provide both at the same time.