Of late, the real estate business has out-performed the stock market, bank investment, market funds and bonds. According to surveys, ninety seven percent of people are making money through investment in the real estate business.
Buying a property is a major investment, as it involves your hard earned money. If you think of buying a property for investment purpose or for your own personal use, then the first thing to do would be to identify the areas that interest you, and then find out its approximate market value. Nowadays investment buyers as well as private buyers employ the services of an estate agent to reduce the stress. These agents usually charge a commission of around 2 to 2.5% of the sales price. However, the selection of an agent should be done only after checking out their credibility.
As a buyer you must view the agent as a useful person to ask advice from on the investments you are planning to make, and find out relevant information like the areas that have potential value in the future. Agents help buyers to make informed decisions by providing them with comparative rates within the same locality. They also add value by holding the deals together, by solving the negotiating problems and by handling tricky situations that may crop up between you and the seller. However, it has to be kept in mind that the agent also represents the seller, so always be careful about the advice given about any specific property.
The best way to go about it is to crosscheck information given by one agent with that of several others, and you will be surprised wit the results. A buyer should always tell the agent that he would like to buy a property at the normal market rates, and never show that he is naive, but project himself as an experienced investor and offer to give references.
Many estate agents have their own websites, which they use to advertise about the various properties, also providing advice and opinions about each area. If you are buying a property for investment purposes, this kind of advertisement is of invaluable help, as you can get to know about a wide variety of areas. Send your proposal via fax describing the conditions of your offer, explaining your strong points and saying that the offer is subject to contract. When the estate agent has something concrete to give to the seller, it displays your seriousness in the deal.
Lastly, when you finally identify a property you would want to invest in, find out all its details from the seller, i.e. what price he is looking for, and the reason for the sale of the property. Sometimes, some properties entail a lot of hassles, like being embroiled in a court case, or neighborhood problems. As a general rule, the seller always likes investors who are ready for one-shot transactions, and whose money is already arranged. If you think there is a competition for the property, you can give a small amount as a token to the seller to show your commitment, however this does not bind the vendor. He can sell the property to someone else with a better offer, although this kind of behavior is unusual. Always try to get to know the vendor and strike up a relationship with them. If they like you, they may accept a lower offer, and also help you out with the legal issues attached with the dealings.
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